Oil prices increase amid concerns about potential supply cuts

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Following talks at a G20 summit with Saudi Crown Prince Mohammed bin Salman, Putin said on Saturday the world's two biggest exporters of crude "have agreed to extend our agreement".

So far, the oil-producing Middle-East group has organized a new plan of supply cuts that would generate some hope to uphold crude futures.

Speaking to Bloomberg, Derek Brower, a director at consultant RS Energy Group said "This might be the critical breakthrough for OPEC and non-OPEC to cut".

"I am optimistic that we will reach a good solution and a good agreement to adjust production downward, to cut production, to ensure that we keep the market stability and keep the OPEC and non-OPEC together as well", Al Mazrouei said on his arrival in the Austrian capital.

Iraq will work with OPEC and other partners to stabilize oil markets and isn't concerned about further declines in crude prices, Fayyad Al-Nima, deputy oil minister for refining affairs, said on November 21.

Russian Federation and Iran back President Bashar al-Assad in Syria's civil war, while Saudi Arabia along with Western countries have backed some rebel groups. At the meeting, the cartel, along with non-OPEC member Russian Federation, is expected to announce cuts aimed at stabilizing prices and reining in production.

It is expected the outcome of this week's OPEC meeting will result in a supply cut, which would be aimed at reining in emergent oversupply.

The reason behind the increase in oil production by Saudi Arabia and other producers in the past few months is because of the USA sanctions over the Iranian oil exports, but the waivers provided by the US allowed Iran to export fewer barrels in the market than expected. Technical teams are working on the level of the cuts necessary and the reference baseline for the reduction, he said. US crude oil imports averaged 8.2 million barrels per day, up by 608,000 barrels per day from the previous week.

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Opec and non-Opec oil producers will hold a ministerial meeting December 6-7.

"Markets are expecting for the OPEC+ deal to be renewed, which should be healthy for consumers and producers and the global economy as a whole".

Both main contracts have plunged by about a third since hitting four-year highs at the start of October, hit by a number of factors including easing demand, high production, softer-than-expected U.S. sanctions on Iran and a global growth slowdown.

US light crude oil rose $2.92 a barrel to a high of $53.85, up 5.7 percent, before easing to around $53.00 by 0930 GMT.

"It's a huge week not only for oil markets but capital markets in general", said Stephen Innes, head of Asia-Pacific trade at OANDA.

That growing belief saw oil prices trim early falls on Friday.

United States oil producers continue to produce record amounts of oil, with crude output at a record level of more than 11.5 million bpd. Its November production surged to an all-time record above 11 million barrels a day as prices swooned, prompting a jubilant response on Twitter from the White House.

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