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Oil prices up with hopes of deeper, extended OPEC cuts

Crude oil prices were up more than 1% on Wednesday with hopes that OPEC would make deeper production cuts this week for a longer period in 2020 to balance the negative impact of coronavirus.

International benchmark Brent crude was trading at $52.44 per barrel at 0700 GMT on Wednesday for a 1.43% increase after it closed Tuesday at $51.70 a barrel.

American benchmark West Texas Intermediate (WTI) was at $47.73 a barrel at the same time for a 1.51% jump after ending the previous session at $47.02 per barrel.

OPEC will convene in the Austrian capital Vienna from Wednesday through to Friday to discuss how to balance coronavirus-related weak oil demand around the world with lower supply.

The 18th meeting of the Joint Ministerial Monitoring Committee (JMMC) will begin on Wednesday at 1100 GMT to advise OPEC and its allies on the extent the group, dubbed as OPEC+, should curb its total production to balance the market.

The 178th extraordinary meeting of the OPEC Conference will start on Thursday at 0830 GMT as the ministers of OPEC member states will convene to discuss how much each country can further cut their respective production.

The 8th OPEC and non-OPEC ministerial meeting will kick off on Friday at 0830 GMT as non-OPEC countries led by Russia will meet to discuss how they can participate in OPEC’s production cut.

While OPEC is expected to make at least a 600,000-barrel-per-day (bpd) additional production cut, the majority of this OPEC heavyweight Saudi Arabia is anticipated to typically carry out.

A higher production curb would take more supply out of the global oil market and support higher crude prices higher for longer.

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