Brent gained 1.11% to settle at $49.25 per barrel after hitting its highest since early March at $49.92. WTI Crude rose settled 0.99% higher at $46.26 per barrel after touching a high of $46.68 a barrel. Both benchmarks are set for a fifth straight week of gains. “We’re higher, despite super bearish events – it’s all about stimulus,” said Bob Yawger, director of energy futures at Mizuho in New York. “You can’t go home short this weekend because they could sign a deal this weekend.”

OPEC+, comprising of the Organization of the Petroleum Exporting Countries and its allies, agreed on a compromise to increase output slightly from January but continue the bulk of existing supply curbs to cope with coronavirus-hit demand. OPEC and Russia on Thursday agreed to ease deep oil output cuts from January by 500,000 barrels per day with further as yet undefined increases on a monthly basis, failing to reach a compromise on a broader policy for the rest of 2021. OPEC+ had been expected to continue existing cuts until at least March, after backing down from plans to raise output by 2 million bpd. The increase means the group will reduce production by 7.2 million bpd, or 7% of global demand from January, compared with current cuts of 7.7 million bpd.

While some analysts saw an under supplied oil market even under the new higher supply quotas, others expected the barrels would tip the market into oversupply. Wood Mackenzie analysts, for example, expect that if the increases continue through March there might be 1.6 million unwanted bpd in the first quarter.

The premium of Brent crude futures for nearby delivery to future months is at its highest since February, a structure called backwardation, which usually points to supplies tightening up and suggests receding fears of a current glut. U.S. production, meanwhile, has recovered from the two-and-a-half-year lows touched in May mainly because shale producers have brought wells back online in response to rising prices.

Crude oil prices hesitated today after the Energy Information Administration reported an oil inventory draw of 700,000 barrels for the week to November 27 but a sizeable build in gasoline inventories. At 488 million barrels, crude oil inventories are still above the five-year average for the season, by about 7 percent. A day before the EIA released its latest weekly inventory numbers, the American petroleum Institute caused an oil price rally arrest by reporting an inventory build of over 4 million barrels for last week. This added to pressure coming from OPEC+ which unexpectedly delayed a meeting that should have ended with a decision on whether or not to extend current production cuts of 7.7 million bpd until at least the end of the first quarter of 2021.

In gasoline, the EIA reported an inventory build of 3.5 million barrels for last week, with production averaging 8.6 million bpd. This compared with a build of 2.2 million bpd a week earlier in inventories, and average production of 8.9 million bpd.

In distillate fuels, the EIA reported an inventory increase of 3.2 million barrels for the week to November 27, with average production at 4.6 million bpd. This compared with a draw of 1.4 million barrels for the previous week and production of 4.6 million bpd.

The EIA also said refineries processed 14 million barrels daily last week, down from a week ago.

Meanwhile, OPEC+ internal discord is threatening a historic deal that stopped the free fall of oil prices in the spring, when lockdowns pushed benchmarks to multi-year lows.

According to a Reuters report citing unnamed sources, not everyone in the extended cartel agreed that they should maintain oil production at current levels, with Russia notably proposing an easing of the current cuts of 7.7 million bpd by half a million bpd monthly beginning in January. The decision has been postponed for tomorrow.

Brent Crude for January delivery, which expires on Monday, dropped 64 cents, or 1.33%, to $47.54 per barrel. The more actively traded February Brent contract was down 48 cents at $47.77. U.S. WTI Crude for January settled 19 cents, or 0.4%, lower at $45.34 per barrel. Oil prices have climbed this month, on track for their biggest monthly gains since May, as vaccine developments raise hopes for an economic recovery that could boost fuel demand.

The Organization of the Petroleum Exporting Countries, Russia and others, known as OPEC+, plan to hold wider talks on Tuesday after discussions of key ministers on Sunday failed to reach a consensus. “When OPEC punted until tomorrow to make a final decision, the market got nervous and started to sell off,” said Phil Flynn, senior analyst at Price Futures Group in Chicago. OPEC+ is due to ease existing production cuts by 2 million barrels per day (bpd) from January, but an uneven recovery in global demand has prompted a rethink. Algerian Energy Minister Abdelmadjid Atta said members have agreed on the need for a three-month extension and will work on convincing their allies in OPEC+ to support the move.

Demand has recovered in Asia but not Europe and the Americas, presenting OPEC+ with a “challenging choice on whether to delay or bring back more oil,” said FXTM analyst Hussein Sayed.

Goldman Sachs said a winter surge in COVID-19 cases would not prevent the oil market rebalancing as a result of vaccine progress. It saw Brent rising to $65 in 2021.

A Reuters poll of 40 economists and analysts forecast Brent would average $49.35 a barrel next year.

Brent crude for January rose 19 cents, or 0.4%, to $47.99 a barrel and the more active February contract gained 19 cents to $48.03. West Texas Intermediate, meanwhile, was down 40 cents, or 0.9%, at $45.32. Both benchmarks are up about 7% over the week after encouraging news on potential COVID-19 vaccines from AstraZeneca and others. However, questions have been raised over AstraZeneca’s “vaccine for the world”, with several scientists sounding caution over the trial results. “While a successful vaccine roll out should break the link between infection and mobility, even then global oil demand will likely only reach its pre-pandemic run rate by mid-2022,” JP Morgan said.

The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia are leaning towards delaying next year’s planned increase in oil output, said three sources close to the OPEC+ group. OPEC+ was planning to raise output by 2 million barrels per day (bpd) in January – about 2% of global consumption – after record supply cuts this year. OPEC+ ministers are due to meet from Monday. “We reiterate our view that the alliance will likely choose to delay the 2 million bpd tapering decision on 30 November by a quarter, from January 1 to April 1,” JP Morgan said. Informal talks between ministers are set to take place on Saturday.

Rising Libyan output is also contributing to concerns about oversupply in the market. The OPEC member, which is exempt from the oil cuts, has added more than 1.1 million bpd of output since early September.