Oil extended its rise to above $41 a barrel this morning after OPEC said it may deepen record oil supply cuts in an attempt to boost prices, sparking expectations of a shrink in hefty crude inventories.
Firmer equity markets, with Japan's Nikkei average up 0.9 per cent today, also helped oil prices.
US light crude for March delivery rose 30 cents to $41.08 a barrel by 1.39am, but is still down 6 per cent from the start of the year and more than 50 per cent from a year ago.
London Brent crude rose 15 cents to $44.23 a barrel.
Oil has plummeted by more than $100 since its record near $150 a barrel as a global downturn weighs on demand for fuels.
The President of the Organization of the Petroleum Exporting Countries said yesterday the group could add to its agreed output cuts of 4.2 million barrels per day when it meets on March 15th.
OPEC in January met only two thirds of its pledge to lower oil output as several members of the producer group continued to pump above target levels, a survey showed.
“While the pressure from oil producing nations continues to be matched by weak economic data, all eyes are on the stimulus packages and how they will affect demand in the coming months,” said Jonathan Kornafel, Asia director at Hudson Capital Energy.
Yesterday, authorities increased the flow of public funds into their economies as a jump in Spanish unemployment and weak retail sales in the United States and Germany provided the latest proof of a severe, synchronised recession.
News that about 30,000 unionised workers at US refineries, chemical plants and pipelines reached a deal with industry on a new basic contract yesterday, averting a nationwide strike, failed to pressure prices.
US crude oil stockpiles jumped 8.1 million barrels last week, according to a report from the American Petroleum Institute.
Reuters