Oil rises, U.S. crude trading near two-month high after OPEC cut

TOKYO, Dec 6 (Reuters) - Oil edged up in early Asia trade on
Friday, with U.S. crude trading near a two-month high after OPEC
agreed to increase output curbs by nearly 50 percent in early
2020, although the cartel stopped short of promising any further
steps after March.
West Texas Intermediate oil futures CLc1 were up by 2
cents at $58.45 a barrel by 0101 GMT. They rose to as high as
$59.12 a barrel on Thursday, the highest since the end of
September.
Brent futures LCOc1 were up 1 cent at $63.40. They fell
0.6% on Thursday.
The Organization of the Petroleum Exporting Countries (OPEC)
and allies including Russia - a grouping known as OPEC+ - have
agreed to more output cuts to avert oversupply early next year
as economic growth stagnates amid the U.S.-China trade war.
The agreement, which needs to be formally adopted later on
Friday, will reduce 500,000 barrels per day (bpd) of production,
through tighter compliance and some adjustments. The group has
been withholding 1.2 million bpd and the new amount represents
about 1.7% of global oil output. The "decision seems to be more of a housekeeping move that
will narrow the gap between their current target and the
over-compliance we have seen from the alliance," said Edward
Moya
senior market analyst at OANDA.
A panel of ministers representing OPEC and non-OPEC
producers led by Russia recommended the cuts be made, according
to Russian Energy Minister Alexander Novak on Thursday.
Details need to be hammered out at an OPEC+ meeting that
starts later on Friday in Vienna.
Higher oil prices are also supporting the initial public
offering of Saudia Arabia's state-owned oil company, Saudi
Aramco, which said on Thursday it priced the shares on sale at
the top of an indicated range. The sale was the world's biggest IPO, beating Alibaba Group
Holdings' $25 billion listing in 2014, but fell short of valuing
Aramco at $2 trillion, a target sought by Saudi Crown Prince
Mohammed bin Salman.
Foreign investors stayed away and the sale was restricted to
Saudi individuals and regional investors.