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Oil prices rise more than 2%; lifted by OPEC cuts, steadying stock market

Oil futures have gained about 9 per cent since last Monday


OMC, oil

prices climbed more than 2 percent on Monday, rebounding further from 1-1/2-year lows reached in December, on support from OPEC production cuts and steadying equities markets.

Brent crude futures rose $1.13 to $58.19 a barrel, a 2 percent gain, as of 12:57 p.m. EST (1757 GMT). U.S. Intermediate (WTI) crude futures rose $1.27 to $49.23 a barrel, a 2.7 percent gain.

futures have gained about 9 percent since last Monday.

"Momentum is coming back into the market from very depressed price levels," said.

Prices drew support from an agreed supply cut by the Organization of the Petroleum Exporting Countries, as well as some non-member countries such as and

OPEC supply fell in December by 460,000 barrels per day (bpd) to 32.68 million bpd, a survey found last week, led by cuts from top exporter

OPEC and its allies are trying to rein in a surge in global supply, driven mostly by the United States, where production surpassed 11 million bpd in 2018. has pushed up U.S. inventories.

"The continues to rally as the OPEC and non-OPEC production cuts are taking effect, reducing the oversupply situation that we've been seeing in the market," said Andrew Lipow, of in

US crude inventories at Cushing, Oklahoma, the delivery point for U.S. crude futures, fell by 565,000 barrels from last Tuesday to Friday, traders said, citing data from market intelligence firm

More upbeat equity markets also offered support.

"When stock markets are strong oil usually follows suit," said.

Shares have risen on expectations that trade talks this week between the and will ease the trade war. Disruptions to trade undermine prospects for economic growth and

said in a note it had downgraded its average Brent for 2019 to $62.50 a barrel from $70 due to "the strongest macro headwinds since 2015."

cut its 2019 for Brent by $9 to $64 a barrel and reduced its forecast for U.S. light crude by $9 to $57 a barrel.

First Published: Tue, January 08 2019. 00:01 IST