Oil extends climb with OPEC+ meeting and weaker US Dollar in focus

Oil edged higher as traders counted down to a key OPEC+ meeting on supply, and weighed signs that the Federal Reserve is done hiking interest rates.

West Texas Intermediate rose toward $77 a barrel after rallying by more than 2% on Tuesday, with global benchmark Brent near $82. The producer group is due to meet online on Thursday to set policy for 2024, but has yet to resolve a dispute over output quotas, according to delegates.

Crude’s gain on Tuesday was supported a weaker US dollar, with a Bloomberg gauge of the US currency sinking to the lowest level since August. Comments from Federal Reserve policy makers including Governor Christopher Waller suggested the central bank is set to halt its run of rate increases. A weaker dollar makes commodities more attractive for overseas buyers.

Oil prices remain on track for a back-to-back monthly decline on increased supply from non-OPEC countries, which has boosted pressure on the Organization of Petroleum Exporting Countries and its allies to impose deeper output cuts. The International Energy Agency said earlier this month that the global crude market was on course to flip back into a surplus next year.

In the US, meanwhile, the industry-funded American Petroleum Institute reported that nationwide inventories fell 817,000 barrels last week, according to people familiar with the figures. Stockpiles at the Cushing hub also declined.

WTI for January delivery rose 0.3% to $76.62 a barrel in Singapore.

Brent for January settlement closed 2.1% higher at $81.68 a barrel on Tuesday.