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Oil prices surge as Saudi seeks more supply cuts

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Oil prices surge as Saudi seeks more supply cuts

Crude has climbed since early October on signs the US-China are close to a breakthrough on an initial trade deal.

Brent futures were trading at $60.53 per barrel at 1310 GMT, down 39 cents.

The Organization of Petroleum Exporting Countries and its allies, who will gather in Vienna in the coming days, are poised for a debate about some nations' lax implementation of production cuts.

Traders should continue to look for heightened volatility ahead of the OPEC meeting on December 5-6.

Russian Energy Minister Alexander Novak said on Tuesday he expected this week's meeting to be constructive, but added that Moscow had yet to finalize its position.

Goldman Sachs on Monday said OPEC+ is likely to extend output curbs through June but expects the "uneventful" three-month extension to provide little support to prices.

The investment bank said it expects Brent to trade around $60 a barrel in 2020 in the absence of geopolitical shocks.

The global oil supply demand balance requires an extension of the current OPEC+ cuts given the large increase in output from non-OPEC projects and an uncertain demand growth outlook, the bank said.

Concerns about the inability of the United States and China, the world's two biggest oil users, to reach a preliminary deal to resolve their 17-month trade dispute also weighed on oil prices, along with discouraging U.S. economic data.

Prices were also supported after Iraq's oil minister said on Sunday that OPEC and allied producers will consider deepening their existing oil output cuts by about 400,000 barrels per day (bpd) to 1.6 million bpd. Their current deal to cut supply by 1.2 million bpd that started from January expires at the end of March 2020.

The U.S. oil producer companies remained unperturbed due to the continuous increase in production with the hope to meet up with shortfalls as the global oil regulator is due to announce possible cuts in supply this week.

But U.S. production keeps rising, filling the gaps left by OPEC, with output in September increasing to a new record of 12.46 million barrels per day (bpd), the U.S. government said in a monthly report on Friday.

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