Oil rose to above $56 a barrel on Tuesday, supported by Saudi Arabian export cuts in November and comments from OPEC and trading companies that the market is rebalancing after years of oversupply.
Saudi Arabia has cut November allocations by 560,000 barrels per day (bpd), in line with its commitment to an OPEC-led supply reduction pact. In the United States, some production remains offline following Hurricane Nate, lending additional support.
“Prices have been boosted by news that Saudi Arabia is planning to reduce its oil shipments to customers in November,” said Carsten Fritsch, an analyst at Commerzbank in Frankfurt.
Brent crude LCOc1, the international price benchmark, was up 80 cents at $56.59 a barrel at 1326 GMT. U.S. crude gained 97 cents to $50.55.
The Organization of the Petroleum Exporting Countries, Russia and other non-member producers are cutting output by about 1.8 million barrels per day (bpd) until next March to get rid of a price-sapping supply glut.
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