Oil advances on report OPEC, allies to discuss deepening cuts

NEW YORK (Bloomberg) - Oil jumped the most in more than a week rose after a report that OPEC and allied crude producers will discuss deepening supply cuts next month.

Futures climbed more than 2% in London and New York on Tuesday. Members of the Organization of Petroleum Exporting Countries are concerned about the outlook for demand next year, Reuters reported, citing unnamed cartel sources.

“The biggest piece of news is that OPEC is considering deeper cuts,” said Josh Graves, senior market strategist at RJ O’Brien & Associates in Chicago. “I think that’s something that needs to be done.”

Oil prices already were heading higher early Tuesday as the S&P 500 Index climbed toward a record high and companies from Procter & Gamble Co. and United Technologies Corp. posted improved outlooks.

U.S. benchmark futures have been under pressure for the past six months as the protracted U.S.-China trade war imperiled worldwide energy demand. President Donald Trump on Monday said negotiations are progressing, raising expectations that the world’s largest economies may sign a deal as soon as next month.

West Texas Intermediate crude for November delivery, which expires Tuesday, rose $1.14 to $54.45 a barrel at 11:32 a.m. on the New York Mercantile Exchange. The more active December contract gained $1.12 to $54.63.

Brent for December settlement increased $1.05 to $60.01 on the London-based ICE Futures Europe Exchange. The global benchmark crude traded at a premium of $5.43 to WTI for the same month.

Meanwhile, U.S. crude inventories probably rose for a sixth time last week, the longest run of gains in almost a year, according to a Bloomberg survey. The government’s weekly tally of supplies in storage is scheduled for release on Wednesday.

“If we get anything above the forecast, that could derail this little pop here, regardless of what OPEC says,” Graves said.