Oil increased in New York as worries over signs of slower economic growth in China were countered by OPEC’s production cutbacks.
Futures rose to near $55.70 a barrel, approaching the highest settlement level during the last two weeks but still little cheer for Nigeria which has set a $60 price level for its 2019 federal budget.
Crude initially fell as much as 2.6 percent as Apple Inc. cited an unforeseen slowdown in China and cut its sales outlook, just days after data showed weakening factory conditions across Asia.
Prices bounced back amid confidence OPEC will push on with promised production cuts, with data showing the group had made an early start on its pledged curbs.
“We really do need a sustained effort from some of the OPEC producers to take supply out of the market in order for prices to recover,” Jason Gammel, an analyst at Jefferies LLC, said in a Bloomberg television interview. “Now we’re starting to see that.”
Brent for March settlement was 78 cents higher at $55.69 a barrel on the London-based ICE Futures Europe exchange. The global benchmark crude climbed 2.1 percent to $54.91 on Wednesday. It traded at a premium of $8.44 to March WTI.
See also: Turbulent or Steady? OPEC or Shale? — The State of Oil in 2019
In a sign of urgency felt by producers to stall the slide in crude prices, Saudi Arabia throttled back production a month before wider supply curbs pledged by OPEC and its allies started this month. The kingdom’s cutbacks reduced OPEC’s overall output by 530,000 barrels a day in December, the group’s sharpest pullback since January 201
