© Reuters. An aerial view shows a crude oil tanker at an oil terminal off Waidiao island in Zhoushan, Zhejiang province, China January 4, 2023. China Daily via REUTERS/File Photo

By Robert Harvey

LONDON (Reuters) -Oil prices rose on Thursday as investors awaited the outcome of an OPEC+ meeting with potential further supply cuts on the agenda.

futures for January gained 65 cents, or 0.78%, to $83.75 a barrel by 1210 GMT. The front-month Brent contract expires later on Thursday.

The more liquid February contract was up 57 cents, or 0.69%, at $83.45.

Meanwhile, U.S. West Texas Intermediate crude futures rose by 55 cents, or 0.71%, to $78.41.

The OPEC+ producer group comprising the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, is likely to agree to additional output cuts of more than 1 million barrels per day (bpd), meeting delegates told Reuters.

A continuation of Saudi Arabia’s 1 million bpd voluntary cut is expected to be supplemented by additional and smaller cuts from other members, the delegates added.

Saudi Arabia’s pledge to extend its voluntary cut would be “really important and take out the risk of a collapse (in any mooted deal),” said Investec analyst Callum Macpherson.

But investors will be waiting for a formal announcement from Thursday’s meeting and a breakdown of the additional cuts.

“Who will have to make the cuts? How long will they last?” Macpherson added.

The OPEC+ meeting is scheduled to begin at 1400 GMT, after an OPEC-only ministers meeting at 1100 GMT.

The meeting, being held on the same day as global leaders gather in Dubai for the U.N. climate conference, was originally scheduled for last week but was deferred because of disagreements over output quotas for African producers.

Implementing additional cuts will send prices higher in the immediate future, but the long-term impact is harder to predict, said Tamas Varga of oil broker PVM.

Compliance will be an issue and the global oil balance is probably much less tight than OPEC estimates, he said, citing the latest commercial inventory data out of the United States and the effect on demand from stubbornly high interest rates in many major economies.