Crude oil futures settled higher on Monday, extending gains to a sixth successive session on reports Saudi Arabia is set to significantly reduce crude exports by the end of this month.
According to reports, Saudi Arabia is likely to cut crude exports by 800,000 barrels per day from November levels, to 7.1 million barrels a day by end January, aiming to lift crude oil prices back past the $80 a barrel mark in order to help cover a surge in government spending.
Meanwhile, according to a private data, inventory estimates at the Cushing storage hub dropped by 565,225 barrels during the first four days of January.
Also, traders expect the fresh round of talks between the U.S. and China that commenced in Beijing today would help the two countries resolve their trade disputes before the expiry of the 90-day truce and help revive global economic growth. Reports that Chinese Vice Premier Liu He attended the opening of the meeting bolstered sentiment.
Crude oil futures for February ended up $0.56, or 1.2%, at $48.52 a barrel, a long way down from the day's high of $49.79 a barrel.
On Friday, crude oil futures ended up $0.87, or 1.9%, at $47.96 a barrel.
Last week, a survey from Reuters showed oil output from OPEC fell by 530,000 barrels a day to 32.6 million a day in December, marking the sharpest pullback since January 2017 as top exporter Saudi Arabia throttled back production.
Data released by the Energy Information Administration on Friday showed crude inventories in the U.S. rose by 7,000 barrels in the week to December 28, beating expectations for a drop of more than 3 million barrels.
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