Oil prices extended gains on Tuesday as a smaller-than-expected November output hike by OPEC+ helped to ease some fears of a growing supply glut.
Brent crude futures advanced 19 cents, or 0.29%, to $65.66 a barrel by 0623 GMT. U.S. West Texas Intermediate crude climbed 19 cents, or 0.31%, to $61.88.
Both contracts settled more than 1% higher in the previous session after the Organization of the Petroleum Exporting Countries plus Russia and some smaller producers - known as OPEC+ - decided to increase its collective oil production by 137,000 barrels per day starting in November.
The move was in contrast to market expectations for a more aggressive reintroduction of supply, a sign that the group remains cautious about increasing its production share in the global oil market amid predictions of a supply surplus in the fourth quarter as well as next year, said ING analysts.
"Brent had fallen by around $5 per barrel last week in response to earlier expectations of a larger supply boost, so this mild rebound seems reasonable," said Anh Pham, a senior analyst at LSEG.
"For now, the market still appears capable of accommodating the extra volume, and we have yet to see a shift into contango at the front of the curve," he added.
OPEC+ has increased its oil output targets by more than 2.7 million bpd this year, equating to about 2.5% of global demand.
Geopolitical factors have kept a floor under prices, with conflict between Russia and Ukraine impacting energy assets and creating uncertainty over Russian crude supply.
Russia's Kirishi oil refinery halted its most productive distillation unit, CDU-6, following a drone attack and subsequent fire on October 4, with its recovery likely to take about a month, two industry sources said on Monday.
Still, oil prices have come under pressure amid output increases from both OPEC+ and non-OPEC+ producers. Moreover, any slowdown in demand due to weak economic growth triggered by U.S. trade tariffs is likely to exacerbate the surplus, analysts said. - Reuters
