Oil prices rose on Tuesday as the possibility that OPEC+ will extend or deepen supply cuts was compounded by a storm-related drop in Kazakh oil output to send the Brent benchmark above $80 a barrel.

OPEC+, comprising the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, is due to hold an online ministerial meeting on Thursday to discuss production targets for 2024.

futures were up 79 cents, or 1%, at $80.77 a barrel by 1131 GMT. U.S. West Texas Intermediate (WTI) crude gained 76 cents, or 1%, to $75.62.

“Barring any negative surprise, the recent drop in prices will probably be viewed as a buying opportunity, especially if further cuts are agreed,” said Tamas Varga of oil broker PVM, referring to the OPEC+ meeting.

The market tumbled last week when OPEC+ pushed back the original date for its meeting to iron out differences on production targets for African producers.

The group has since 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 production cuts.

Oil also found support from a weak dollar, an expected decline in inventories and the drop in Kazakh output.

Kazakhstan’s largest oilfields have cut their combined daily oil output by 56%.

Four analysts polled by Reuters estimated that the latest round of weekly U.S. supply reports will show crude inventories fell by about 2 million barrels.

The first of this week’s two reports is due at 2130 GMT from the American Petroleum Institute.
Source: Reuters