By Sarah McFarlane and Stephanie Yang 
   -- Oil prices edged higher Monday, reversing earlier losses as traders 
      weighed whether the Organization of the Petroleum Exporting Countries and 
      Russia would cut production at their next meeting. 
   -- Light, sweet crude for December delivery rose 0.5% to $56.76 a barrel on 
      the New York Mercantile Exchange, after trading as low as $55.08 earlier 
      in the trading day. 
 
   -- Brent, the global benchmark, settled up 3 cents at $66.79 a barrel. 

HIGHLIGHTS

U.S. drilling: The number of active oil-directed drilling rigs in the U.S. rose by two, taking the total to 888, weekly data published by Baker Hughes on Friday showed. Drilling activity is at the highest level since March 2015, as the U.S. pumps record amounts of crude.

OPEC: Analysts said OPEC will have to cut crude production to support oil prices, after the U.S. allowed major buyers of Iranian oil to keep buying after sanctions. The global oil cartel will meet with its allies including Russia on Dec. 6 to discuss reducing output. Expectations that Saudi Arabia will want to cut have kept oil prices buoyed, but the prospect of a lesser deal has kept the market from rallying. "As we head into year-end, there's a little bit of concern that there's too much supply relative to demand," said Michael Hewson, chief market analyst at brokerage CMC Markets. "What we're looking for is the Saudi's to put a floor under prices...the question is will they be able to cut by a sufficient amount to arrest the slide."

U.S. production: Meanwhile, U.S. production has outpaced that of Saudi Arabia and Russia, adding supply to the market and leading to an influx of stockpiles in the U.S. That could put more pressure on OPEC to cut production, some analysts said, and weigh on the market in the longer term. "We still expect a rise in the oil price in the coming months, until an increase in U.S. crude-oil exports weighs on prices in late 2019," said Harry Tchilinguirian of BNP Paribas in a Monday report.

INSIGHT

Russia: While Saudi Arabia has signaled intentions to reduce its supply in the global oil market, reports say that Russia is less willing to cut back on production. Russia's crude output climbed to a record 11.4 million barrels a day in September, according to Wood Mackenzie. "As OPEC continues to consider the idea of additional cuts in order to stop oil's recent slide, Russia has appeared less supportive, potentially placing a greater burden on Saudi Arabia for any coordinated action," analysts at Schneider Electric said.

Selloff: Last week's selloff in oil markets, triggered by a combination of more Iranian crude being available to the global market than expected, revisions higher to U.S. output and a slowdown in global demand, has reset the outlook for oil prices, analysts said. "It takes a brave oil trader to expect next year's prices average above that of 2018," said Tamas Varga, analyst at brokerage PVM.

AHEAD

   -- The American Petroleum Institute releases its weekly statistical bulletin 
      at 4.30 p.m. Tuesday. 

Write to Sarah McFarlane at sarah.mcfarlane@wsj.com and Stephanie Yang at stephanie.yang@wsj.com

(END) Dow Jones Newswires

November 19, 2018 15:51 ET (20:51 GMT)

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