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Oil Steadies Above $59, OPEC Supports | ASHARQ AL-AWSAT English Archive 2005 -2017
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SINGAPORE/LONDON (Reuters)- Oil steadied above $59 a barrel on Thursday, supported by signs that the Organization of the Petroleum Exporting Countries may make larger cuts in output to prop up prices.

The 11-menber group is prepared to make a significant cut in output, sources within OPEC said on Thursday. Oil has slid from a record high of $78.40 reached in July, alarming OPEC ministers.

U.S. crude rose 18 cents to $59.59 a barrel by 1007 GMT. London Brent was up 10 cents at $59.32 a barrel.

An OPEC delegate told Reuters on Thursday that “the direction and spirit are there” for OPEC to make a significant cut in supply. OPEC pumps more than a third of the world’s oil.

“Consensus is building within OPEC to agree a major cut,” a second OPEC source told Reuters.

OPEC’s sixth-biggest producer Nigeria and fourth-biggest Venezuela last week announced token output cuts, totaling 170,000 barrels per day or less than 1 percent of OPEC’s output.

Kuwaiti Oil Minister Sheikh Ali al-Jarrah al-Sabah raised the chance of broader action on Wednesday, telling Reuters that Kuwait may also cut back if prices continued to fall sharply.

On Wednesday, Saudi Arabia’s ambassador to the United States reiterated Riyadh’s view that there is an abundance of oil. The kingdom is the world’s top oil exporter.

Oil also drew support from a fresh outbreak of violence in the oil-producing region of Nigeria, Africa’s top producer.

Nigerian militants said on Wednesday they killed 17 soldiers in two separate gun battles in the country’s oil heartland and threatened further attacks on strategic oil facilities.

The world’s eighth-largest oil exporter has already shut down more than a quarter of its oil output for most of this year because of civil unrest.

Risks to supply in Nigeria and OPEC comments lifted prices from an eight-month low on Wednesday. Prices have been pressured by brimming inventories in top consumer the United States.

U.S. crude stocks rose 3.3 million barrels last week, countering expectations for a drop, while distillate supplies rose 200,000 barrels, remaining at the highest level since 1999.