By Christopher Alessi and Amrith Ramkumar 

-- Oil prices edged down Monday morning, paring some of their Friday advance that followed an OPEC-led decision to again rein in production.

-- Brent crude, the global oil benchmark, was trading down 1.6% at $60.68 a barrel on London's Intercontinental Exchange.

-- West Texas Intermediate futures, the U.S. oil gauge, were down 2.2% at $51.47 a barrel on the New York Mercantile Exchange.

HIGHLIGHTS

Volatile Trading: Following a rise in prices on Friday, the crude market experienced a "bit of a correction" on Monday morning, said Georgi Slavov, head of energy research at brokerage Marex Spectron.

But "it's more just noise," he said, adding that prices should continue to rally through the end of the year in the wake of a Friday decision by the Organization of the Petroleum Exporting Countries and its production allies to cut output by a collective 1.2 million barrels a day starting in January.

Prices climbed more than 2% Friday after Saudi Arabia, the de facto head of OPEC, and Russia, its main partner outside the cartel, eked out an agreement to curb a burgeoning supply glut.

Lingering Demand Fears: Analysts say broad fears about slower global growth and weakening demand are also keeping a lid on oil prices as trade negotiations between the U.S. and China continue.

Such anxiety has hurt other commodities and stocks in recent weeks. The worries have also pushed some investors toward the dollar, making oil and other assets denominated in the U.S. currency more expensive for overseas buyers. The WSJ Dollar Index, which tracks the dollar against a basket of 16 other currencies, rose 0.2% Monday.

INSIGHT

OPEC+: After days of tense negotiations, the oil cartel agreed at its official semi-annual meeting in Vienna last week to collectively cut crude output by 800,00 barrels a day from an October baseline, beginning Jan 1. The cartel's partner producers, led by Russia, signed on to cuts of 400,000 barrels a day. The group agreed to the reduction for six months, with an opportunity to review the market situation in April.

"The group sent a strong signal committing to keep the oil market in balance by taking into account supply and demand concerns, while emphasizing that its decisions are not driven by a political agenda," said Giovanni Staunovo, commodities analyst at UBS Wealth Management. The deal provided exemptions for Iran, Venezuela and Libya, given geopolitical and economic constraints on their production.

Ehsan Khoman, head of research and strategy for the Middle East at MUFG Bank, Ltd. noted that the "OPEC+ strategy for a further iteration of production cuts is a strong signal to the market that the group intends to continue supporting prices at the expense of market share -- once again OPEC+ sees its role as an interventionist one."

Some analysts expect prices to stay range bound moving forward as investors weigh whether the OPEC supply cuts will be enough to rein in a burgeoning glut amid record U.S. output.

AHEAD

-- The American Petroleum Institute, an industry group, on Tuesday releases weekly data on U.S. oil inventories, followed by official U.S. government data Wednesday.

The U.S. Energy Information Administration releases its Short-Term Energy Outlook report on Tuesday, and the Organization of the Petroleum Exporting Countries releases its monthly oil market report on Wednesday.

Write to Christopher Alessi at christopher.alessi@wsj.com and Amrith Ramkumar at amrith.ramkumar@wsj.com

(END) Dow Jones Newswires

December 10, 2018 10:37 ET (15:37 GMT)

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