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Brent crude futures were up 50 cents, or 0.6%, at $79.20 a
barrel by 1001 GMT and U.S. West Texas Intermediate crude
futures gained 47 cents, or 0.6%, to $79.20.
The Brent benchmark had approached $85 a barrel in Monday
trading.
Two OPEC+ sources said on Thursday that the group has kept its
output policy unchanged and will decide in March whether to
extend the voluntary oil production cuts in place for the first
quarter.
The Organization of the Petroleum Exporting Countries (OPEC) and
allies led by Russia, together known as OPEC+, has output cuts
of 2.2 million barrels per day (bpd) in place for the first
quarter, as announced in November.
"What has been already been made clear last year is that the
reversal of those cuts will be gradual," said UBS analyst
Giovanni Staunovo, adding that the bank expects an extension
into the second quarter.
Also supporting oil prices was the U.S. Federal Reserve's
decision to keep the benchmark overnight interest rate in the
5.25-5.50% range and comments by Fed Chair Jerome Powell, saying
interest rates had peaked and would move lower in the coming
months.
Lower interest rates would reduce consumer borrowing costs,
which can boost economic growth and oil demand.
However, oil prices were still heading for weekly losses of
about 5% after unsubstantiated reports of a ceasefire between
Israel and Hamas capped gains and caused the contracts to settle
more than 2% lower on Thursday.
Concern over China's economic recovery continued to linger, with
the International Monetary Fund on Friday forecasting that the
country's economic growth would slow to 4.6% in 2024 and decline
further in the medium to about 3.5% in 2028.
Meanwhile, concern over shipping dragged on after a military
spokesperson for the Iran-aligned Houthi group said on Thursday
that attacks on shipping will persist until Israel's "siege on
the Gaza Strip is lifted".
(Reporting by Noah Browning, Emily Chow and Jeslyn LerhEditing
by David Goodman)
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