Oil prices have made gains due to reports that one of the largest oil exporting members in OPEC, Saudi Arabia, has been lobbying for an extension of the production-cut deal beyond June. 

Reuters reported that Brent crude futures climbed 20 cents to touch $56.43 per barrel, the highest since early March.

US West Texas Intermediate (WTI) crude futures gained 18 cents to be traded at $53.58 a barrel, which is also their highest price level since early March. 

According to a report by Wall Street Journal, Saudi Arabia has informed other members of the oil organisation that it wants to extend a coordinated production cut beyond the first half of this year.

OPEC members and other oil producers have decided to cut their production by 1.8 million barrels a day for the first six months of 2017, which is scheduled to end in June. 

The compliance level among most member countries has been high. Saudi Arabia is reported to have reduced its output by nearly 4.5%.

"Saudi Arabia is reported to have reduced its output by nearly 4.5%."

Despite this output-cut initiative, the oil market remained largely oversupplied due to rising US production and stockpiles.

Saudi Arabia provided its important customers in Asia with all contract volumes fearing a loss of market share.

The Energy Information Administration (EIA) said that next year, US crude oil output would grow to 9.9 million barrels per day (bpd) from the current 9.22 million bpd.

As demand is expected to increase by 340,000bpd next year, the increase in production will swell US inventory.

American Petroleum Institute indicated a fall in US inventory this week.

Image: An offshore platform in the North Sea. Photo: courtesy of Swinsto101/ Wikipedia.