Edinburgh: Oil rose for a second day on signs that producers are following through with agreed production cuts while most other financial markets took a breather from a rally that has propelled European stocks to their biggest weekly gain since February.
US crude advanced to more than $51 a barrel before Opec meets in Vienna with representatives from 14 other nations to discuss production cuts.
Oil producers look to be turning word into deed with Saudi Arabia and Kuwait on the verge of following through on an agreement to cut production for the first time in eight years. At the same time, the ECB’s pledge to expand its limits on asset purchases to include shorter-dated securities is expected to drive down borrowing costs for banks even though the central bank has announced it will curtail monthly additions after March, and is being interpreted as a buy signal in many quarters of the financial markets.
“The ECB decision supports financial assets as long as the expansionary monetary policy continues,” said Giovanni Staunovo, an analyst at UBS Group AG in Zurich. “Ongoing liquidity means everyone is happy.”
