Oil prices have increased by 1% amid expectations that the Organization of the Petroleum Exporting Countries (OPEC) and perhaps Russia will reduce supply toward year-end.

Front-month Brent crude oil futures soared 65 cents, or 1%, to reach $67.41 per barrel, while US West Texas Intermediate (WTI) crude futures increased by 76 cents, or 1.4%, to stand at $57.22, Reuters reported.

Trifecta director Sukrit Vijayakar was quoted by the news agency as saying: “Oil prices continued to recover, as the market will be watching closely for the possible impact of a (supply) cut.”

OPEC and its allies are expected to cut supply by one million to 1.4 million barrels per day (Mbpd) to adjust for a slowdown in demand growth and prevent excess supply in the market.

“Oil prices continued to recover, as the market will be watching closely for the possible.”

Russian Energy Minister Alexander Novak stated that the country is looking to enter a partnership agreement with OPEC. The producer cartel and Russia will discuss the details of the proposed deal at a meeting in Vienna next month.

Crude prices have lost around a quarter since reaching their recent peaks early last month, amid rising supply and a slowdown in demand growth for crude.

The decrease in prices came after the US granted waivers to eight countries, including India, to continue buying crude oil from Tehran.

Sources told Reuters that Japanese refiner Fuji Oil is set to resume crude imports from Tehran. Japan is one of the beneficiaries of the exemptions granted by Washington.

After the sanctions targeting Iran’s crude exports came into force at the start of this month, Japan stopped buying Iranian oil.

Meanwhile, markets remained wary after the US and China failed to find a solution to their ongoing trade war at the Asia-Pacific Economic Cooperation (APEC) last weekend.

Futures brokerage FXTM chief market strategist Hussein Sayed said US comments from APEC ‘suggest that a deal between President Trump and President Xi is unlikely to see the light when the leaders meet at the G20 Summit later this month’.

On the supply front, the US crude production is surging.

According to Baker Hughes, US energy companies added two oil rigs last week, bringing the total rig count to 888.

The rig count represents the highest level since March 2015.