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Oil futures rally over 5% amid output cut rumors

Published 02/12/2016, 06:55 AM
© Reuters.  Oil moves higher but remains near 13-year trough
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Investing.com - U.S. oil futures rallied over 5% on Friday, boosted by rumors of a potential decline in production levels by the Organization of the Petroleum Exporting Countries but prices still remained below $27 a barrel, near a 13-year trough.

U.S. crude futures for March delivery were last at $27.59 a barrel, up 5.25%.

On the ICE Futures Exchange in London, the April Brent contract was up 5.26% at $31.64 a barrel.

Oil prices strengthened after the United Arab Emirates energy minister said late Thursday that the OPEC was willing to talk with other exporters about cutting output.

He added that cheap oil was already forcing some output reductions which would help rebalance the market.

Global crude production is outpacing demand following a boom in U.S. shale oil and after a decision by the OPEC last year not to cut production in order to defend market share.

Oversupply issues will be exacerbated further as Iranian exports return to the global oil market.

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