Oil prices up

NEW YORK — Oil prices rose about 2 percent on Tuesday, supported by Saudi Arabian export cuts in November and comments from OPEC and trading companies that the market is rebalancing after years of oversupply.

Saudi Arabia has cut November allocations by 560 000 barrels per day (bpd), in line with its commitment to an OPEC-led supply reduction pact.

The Organisation of the Petroleum Exporting Countries is seeking to hold a second meeting with US independent oil firms as well as hedge funds, OPEC’s Secretary General told Reuters, adding that no oil producer could afford to live in isolation.

Brent crude LCOc1 settled up 82 cents, or 1,5 percent, at $56,61 a barrel while US crude rose $1,34, or 2,7 percent, to settle at $50,92. From a technical standpoint, US crude has staged an impressive rebound from the $49,08 level and a decisive breakout above $51 should encourage a further incline towards $52,40 a barrel, said Lukman Otunuga, research analyst at FXTM.

“In an alternative scenario, sustained weakness below $49, which is also under the 50 (day) daily simple moving average, may open a path towards $47,80.” OPEC, Russia and other non-member producers are cutting output by about 1,8 million barrels per day (bpd) until next March to get rid of a price-sapping supply glut. The group is increasingly confident that the market is rebalancing fast, helped by the cutback as well as by stronger-than-expected growth in global demand.