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By Trend

Oil prices rose on Wednesday, reversing out of a 1% slump in the previous session, boosted by producers weighing further output cuts to counter a potential squeeze on global oil demand resulting from China’s fast-spreading coronavirus, Trend reports citing Reuters.

Brent crude oil futures LCOc1 were up 44 cents, or 0.8%, to $54.40 a barrel by 0127 GMT, while U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 42 cents or 0.9% to $50.03 a barrel.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, a group known as OPEC+, weighed the impact on global oil demand, and economic growth, of the coronavirus outbreak at a meeting on Tuesday, hearing from China’s envoy to the United Nations in Vienna.

Producers are weighing further output cuts and moving a planned policy meeting to February rather than March.

“At these prices, commodity producers will soon begin to cut back on production and investment,” Moody’s Analytics said in a note on Wednesday. “Given the economic damage caused (by the virus) prospects are poor that prices will recover soon.”