Oil heads north as output cut begins

Oil rose towards $27 a barrel on Friday as Opec and its allies began a record output cut to tackle a supply glut weighing on the market due to the coronavirus crisis.

The global oil benchmark, Brent crude, has sunk by almost 60 per cent in 2020 and reached a 21-year low last month as the coronavirus pandemic squeezed demand and Opec and other producers pumped at will before reaching a new supply cut deal which began on Friday.

Brent for July rose 37 cents, or 1.4 per cent, to $26.85 by noon. US crude for June added 83 cents, or 4.4 per cent, to $19.67. Both benchmarks rallied sharply on Thursday. Brent rose 12 per cent and US crude gained 25 per cent.