Oil prices rose slightly on Tuesday due to a weak dollar, and expectations that the OPEC+ producer group would deepen and extend output cuts due to fears demand would remain subdued.
Brent crude futures were up 11 cents, or 0.1%, at $80.09 a barrel at 0510 GMT. U.S. West Texas Intermediate (WTI) crude futures were trading 4 cents higher, also 0.1%, at $74.90 a barrel.
Both benchmarks pared some gains after rising sharply in early Asian trade.
OPEC+, which combines the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, will hold an online ministerial meeting on Nov. 30 to discuss production targets for 2024.
The meeting comes amid a sharp decline in oil prices, due to concerns that the market was oversupplied despite output cuts by the OPEC+. Brent has fallen by more than 18% and WTI by over 21% since end-September highs. Strong production by non-OPEC countries such as the United States have added to pressure on prices.
OPEC+ set oil prices tumbling last week by postponing its meeting in order to iron out disagreements over production targets for African producers. But it has moved towards a compromise, four OPEC+ sources told Reuters on Friday, potentially helping the group’s de facto leader Saudi Arabia find consensus on the need to deepen output cuts.
The decline in prices could spare Riyadh any pressure from the U.S. to limit output cuts, according to analysts.
“Saudi Arabia may be comforted that US gasoline prices have fallen for 60 straight days. This may soften the US opposition to any move to tighten oil markets and support prices,” ANZ Research said in a note on Tuesday.
The U.S. dollar’s retreat to its lowest level in three months should bolster demand fronm countries who pay for their oil in other currencies.
(Reporting by Sudarshan Varadhan; Editing by Sonali Paul & Simon Cameron-Moore)