Oil prices have increased by 2% with support from production cuts by the Organization of the Petroleum Exporting Countries (OPEC) and stabilising share markets.

Brent crude LCOc1 increased $1.13 at $58.19 a barrel, while US crude CLc1 rose 84 cents to $48.80 a barrel, Reuters reported.

Petromatrix strategist Olivier Jakob said: “Momentum is coming back into the market from very depressed price levels. We’ve had five consecutive days of price gains already, so what you have today is a continuation of that.”

Prices are gaining support from an agreed supply cut by the oil cartel and some non-member countries such as Russia and Oman.

“Momentum is coming back into the market from very depressed price levels.”

Last week, a survey by Reuters revealed that OPEC oil supply in December declined by 460,000 barrels per day (bpd) to 32.68 million barrels per day (Mbpd) led by cuts from Saudi Arabia.

The production cut is aimed at slowing an increase in global supply, driven mostly by the US, where production increased to more than 11Mbpd last year.

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According to weekly data released by the Energy Information Administration (EIA), US inventories also increased by nearly 17% last year due to record production of crude oil.

Oil prices also gained support from more upbeat equity markets following expectations that trade talks between the US and China this week would put an end to a trade war.

This has added to concerns of an economic downturn, which is expected to affect oil demand.