Signs of much larger OPEC supply cuts than previously expected have lifted oil prices. The rebound comes after prices decreased by 5% in the previous session.

International benchmark Brent crude futures soared by $0.27, or 0.5%, to stand at $54.62 a barrel, while US West Texas Intermediate (WTI) crude futures jumped $0.33 per barrel, or 0.7%, to reach $46.22, Reuters reported.

The futures are expected to post weekly declines of 9.4% and 9.5%, respectively.

Crude prices have been dragged down by concerns over the global economy and a potential US Government shutdown on 21 December.

In a letter seen by Reuters, OPEC secretary-general Mohammad Barkindo stated that the producer club OPEC is planning to unveil a table that outlines respective production cut quotas for its members and other producers, including Russia.

Barkindo added that to achieve the agreed supply cut target of 1.2 million barrels per day from next month, the effective reduction for OPEC members was 3.02%, which is higher than the 2.5% level initially discussed as part of the supply policy.

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“The current oil prices will force OPEC to increase compliance with the production cut deals, supporting Brent prices.”

The revised level is a result of OPEC’s plans to accommodate member nations Iran, Libya, and Venezuela, which have been exempted from the agreed supply cuts programme.

Guotai Junan futures crude research head Wang Xiao was quoted by the news agency as saying: “The current oil prices will force OPEC to increase compliance with the production cut deals, supporting Brent prices.

“The temporary recovery in prices has been driven by short sellers buying back.”

Since reaching four-year highs in the first week of October, WTI and Brent futures have lost more than 30%. The slump was triggered by concerns over oversupply and the impact of a slowing global economy on oil demand.