Mubasher: Oil prices climbed on Tuesday, extending strong gains from the prior session, encouraged by prospects of supply cuts by the Organization of Petroleum Exporting Countries (OPEC).

Crude markets were also buoyed by a mandated reduction in production from Canada as well as a 90-day ceasefire in the trade conflict between the US and China.

By 7:53 am GMT, US Nymex crude futures rose 0.96% to $53.46 per barrel (pb), while global benchmark Brent futures jumped 1.01% to $62.31 pb.

Both contracts surged by nearly 4% from their last settlement after Washington and Beijing agreed on the trade war truce, while both sides would negotiate for 90 days before any further action.

OPEC members and their allies, including non-OPEC Russia, would gather on 6 December in Vienna, Austria to discuss a joint output policy.

“We expect OPEC to follow suit and agree to a production cut in Vienna this coming Thursday,” Goldman Sachs said in a note to clients.

“A cut in OPEC and Russian production of 1.3 million barrels per day (bpd) will be required to reverse the ongoing counter-seasonally large increase in inventories,” Goldman noted.

The producer group along with Russia are set to withhold supply to push Brent crude prices “above the mid-$60 per barrel level,” the US bank added.

In the same vein, the Canadian province of Alberta forced producers to reduce production by 325,000 bpd to handle a pipeline bottleneck that led crude to build up in storage.