Oil prices extend rally as producers restrain output | Reuters

Oil prices extend rally as producers restrain output | Reuters

Oil prices rose around 1% on Tuesday after major crude producers showed they were reining in output roughly in line with their commitments, extending gains for a market thrown out of kilter by weak demand during the coronavirus pandemic.

Brent crude was up 48 cents, or 0.9%, at $56.83 a barrel by 0754 GMT, its third straight day of gains. U.S. oil gained 52 cents, or 1%, to $54.07. Both contracts rose more than 2% in the previous session.

OPEC crude production rose for a seventh month in January but the increase was smaller than expected, a Reuters survey found.

The Organization of the Petroleum Exporting Countries (OPEC) was pumping 25.75 million barrels per day (bpd) in January, the survey found, up 160,000 bpd from December.

Market analysts say the OPEC has been showing more discipline in keeping to its commitments as surging COVID-19 infections threaten any recovery in demand.