Oil advances on output cuts possibility

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Oil prices recovered on Monday as optimism grew that OPEC members and allied oil manufacturers will settle a deal on Thursday. The agreement will mandate oil producers to reduce crude production in order to offset suffering prices due to the novel coronavirus.

Brent crude LCoc1 inched up by 75 cents, equivalent to 2.4%, and last stood at $32.62 per barrel. It salvaged some gains after a 3.6% decline on Tuesday. U.S. West Texas Intermediate (WTI) crude CLc1 added 5.5% and was quoted at $24.93 per barrel. It reversed after a 9.4% setback in its last session.

The video conference between the members of Organization of Petroleum Exporting Countries and other associates is expected to yield a positive outcome. Investors anticipate an agreement since the previous convention back in March had resulted to a price dispute between Russia and Saudi Arabia.

Saudi Arabia and Russia are likely to sign the deal. However, the success of the said truce lies on whether the United States will cooperate, the U.S. Department of Energy said on Tuesday.

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