By Laila Kearney
NEW YORK (Reuters) - Oil prices rose more than 1 percent on Tuesday after OPEC figures showed it cut production sharply in January, and as lead member Saudi Arabia said it would reduce its output in March by an additional 500,000 barrels.
Production cuts effective to the end of June by the Organization of the Petroleum Exporting Countries and allies led by Russia have tightened markets despite rising output in non-member countries, primarily the United States.
Saudi Arabia Energy Minister Khalid al-Falih told the Financial Times that the country would cut production to about 9.8 million bpd in March to bolster prices. As part of the OPEC deal, that nation pledged to cut output to about 10.3 million bpd.
Investors were also hopeful that a new round of U.S.-China talks this week would bring the two sides close to resolving their ongoing trade war ahead of a March 1 deadline, Yawger said.
The Energy Information Administration said on Tuesday it expected U.S. crude production to hit a new record of 13.2 million bpd through 2020, which took some steam out of the rally, traders said.
OPEC also cut its forecast for 2019 world oil demand, citing slowing economies and expectations of faster supply growth from rivals, underlining the challenge it faces in preventing an oil glut.
U.S. crude stockpiles were forecast to have risen last week for a fourth straight week, ahead of data from the American Petroleum Institute (API), an industry group, at 4:30 p.m. EST (2130 GMT).
(Graphic: U.S. oil production & drilling levels - https://tmsnrt.rs/2Tm4u4I)
(Reporting by Laila Kearney; Additional reporting by Noah Browning and Henning Gloystein; Editing by Marguerita Choy and Lisa Shumaker)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)