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U.S. oil rises 2%, adding to gains after supplier meeting agreed

Published 17/03/2016, 11:48 am
© Reuters.  U.S. oil rises 2%, adding to gains after supplier meeting agreed
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TOKYO, March 17 (Reuters) - U.S. oil futures rose more than 2 percent in early Asian trade on Thursday, adding to strong gains the previous session after the world's biggest suppliers firmed up plans to meet to discuss freezing output.

Oil producers including Gulf OPEC members support holding talks next month on a deal to keep production at current levels even if Iran declines to participate, OPEC sources said on Wednesday, increasing the likelihood of the first global supply deal in 15 years. crude CLc1 was up 76 cents at $39.22 a barrel at 0136 GMT and earlier traded as high as $39.38.

The contract settled up $2.12, or 5.8 percent, at $38.46 a barrel on Wednesday, erasing the losses of the previous two trading days.

Brent crude LCOc1 rose 53 cents to $40.86.

On Wednesday, it finished up $1.59, or 4 percent, at $40.33 a barrel.

"A smaller than expected gain in inventories in the U.S. also supported prices," ANZ said in a morning note.

U.S. crude oil stocks rose last week to record highs for a fifth straight week, data from the Energy Information Administration showed on Wednesday.

Crude inventories USOILC=ECJ increased 1.3 million barrels in the week to March 11 to 523.2 million, a much smaller build than the 3.4 million-barrel increase expected by analysts.

The market is also rallying after a less hawkish U.S. monetary outlook, as the U.S. Federal Reserve held interest rates steady and indicated two rate hikes this year instead of the four expected.

Qatari oil minister Mohammed Bin Saleh Al-Sada said producers from within and outside the Organization of the Petroleum Exporting Countries will meet in Doha on April 17 to discuss plans for a freeze in output.

Around 15 OPEC and non-OPEC producers, accounting for about 73 percent of global oil production, support the initiative, the minister said.

Since the freeze was first proposed last month, prices have recovered about 50 percent from decade-low levels but been volatile without a firm meeting date.

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