Oil prices jumped on Tuesday, driven by traders' confidence in recent market weakness. It will contribute to further supply cuts by OPEC. At the same time, anti-government protests in China and hawkish statements from the Federal Reserve worsened demand prospects.
The start of the week was volatile, with oil prices initially falling as protests against the government's tough COVID-19 policy intensified in China.
However, prices recovered at the end of the session, as market participants bet that OPEC would intervene to support prices. The cartel is scheduled to meet December 4 to decide on production volumes.
Oil prices are currently trading below the level that triggered OPEC's October supply cut. Thus, there is a growing chance of a decision on production cuts at the cartel's meeting this Sunday.
Rising U.S. interest rates and lower demand in China have been the main factors holding back oil markets this year. In addition, a stronger dollar has also made crude supplies more expensive for major importers.