Oil Futures End Higher As OPEC Decides To Extend Output Cuts

Crude oil futures ended notably higher on Monday, despite giving up a substantial portion of its earlier gains.

Oil's surge was due to OPEC's decision to extend its current 1.2 million barrel per day output cuts for another nine months instead of the expected six month extension. Final details will be out after the cartel's meeting with Russia and other top nonmember producers on Tuesday, the second day of the meeting in Vienna.

West Texas Intermediate crude oil futures ended up $0.62, or 1.1%, at $59.09 a barrel, after hitting a high of $60.28 a barrel earlier in the session.

Brent Crude oil futures moved past $65.00 a barrel mark.

On Friday, WTI crude oil futures for August ended down $0.96, or 1.6%, at $58.47 a barrel.

WTI oil futures gained 1.8% last week, and climbed up more than 9% in June.

Oil prices rose sharply Monday morning, reacting to reports that the Organization of Petroleum Exporting Countries (OPEC) may continue to cut production till 2020 in order to bolster oil prices.

Reports also suggested that Russia and Saudi Arabia will likely agree with the decision.

Saudi Arabia's Energy Minister Khalid al-Falih reportedly said most OPEC members would like to see a nine-month deal extension.

Reports about Iran breaching its nuclear agreement played a role as well in lifting oil prices. Reuters quoted Iran's Foreign Minister Mohammad Javad Zarif as saying that Iran breached the limit of its enriched uranium stockpile set in 2015. Zarif reportedly confirmed that Iran had gone over the relevant limit of 300 kg of uranium.

Oil's uptick was also supported by the U.S.-China trade truce that came about after the U.S. President Donald Trump and the Chinese President Xi Jinping met on the sidelines of the G20 summit on Saturday.

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