Oil prices rallied again Tuesday, with producers announcing spending cuts that added to a slew of positive factors helping to drive the commodity higher.
U.S. crude climbed more than $1.50 a barrel on Tuesday and was trading above $51 a barrel by 12:30 p.m GMT (7:30 a.m. EST). Brent crude for March delivery opened at $55 a barrel and had risen to $56.68 a barrel by the same time. Both have seen gains of around 3 percent in morning trade and have climbed around 16 percent since Friday.
It came as BP CEO Bob Dudley told CNBC on Tuesday that the number of U.S. shale rigs was “dropping like a stone,” but added that it would be a while before excess supply worked its way out of the market.
“The really good parts of the shale (industry) can sustain $30, but those that are around the fringes of that, they’re going to struggle. I think we’ll see eventually … (the number) flatten out and then drop.”
Oil has seen a few sessions of firmer prices, with the Brent crude benchmark close to erasing its total losses for the year so far.
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