MTECHTIPS:-Oil prices rally more than $1 on bullish Saudi comments

MTECHTIPS:-Oil prices rally more than $1 on bullish Saudi comments

MTECHTIPS- Oil prices were sharply higher on Tuesday, as upbeat comments from Saudi Arabia’s oil minister added to optimism that major oil producers are sticking to their pledge to cut back output as part of a deal to curb global oversupply. Crude oil for February delivery on the New York Mercantile Exchange jumped $1.04, or around 2%, to $53.41 a barrel by 9:40 AM ET (14:40 GMT). Markets in the U.S. were closed Monday for a public holiday. Elsewhere, Brent oil for March delivery on the ICE Futures Exchange in London rose 97 cents, or about 1.8%, to $56.83 a barrel, after gaining 41 cents, or 0.74%, on Monday. Saudi Arabian Energy Minister Khalid al – Falih said on Monday that the kingdom will adhere strictly to its commitment to cut output under a global agreement, expressing confidence that OPEC’s plan to prop up prices would work. Speaking to reporters on the sidelines of an industry event in Abu Dhabi, Falih added that OPEC and non-OPEC producers are unlikely to extend their agreement to cut oil output beyond six months, citing the level of compliance with the deal and the re balancing of the market. Meanwhile, OPEC Secretary-General Mohammed Barkindo forecast on Monday that stability would return to oil markets this year while price hawk Venezuela said it hoped its crude basket would rise to $70 in coming months

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