Joe Brock, Reuters
LONDON (Reuters) - Oil rose above $64 on Tuesday, after industry sources said Saudi Arabia had already made substantial cuts in supplies and helped the market recoup earlier losses.
Saudi Arabia, the world's biggest oil exporter, has reduced exports by around 900,000 barrels per day from a peak in August, one source said.
U.S. light crude for December delivery was up 69 cents at $64.60 a barrel by 7:07 a.m. EDT. It had touched a session low earlier of $62.25. Oil suffered its biggest monthly drop ever in October.
London Brent crude was up 42 cents at $60.90 a barrel. Earlier Brent had touched a 20-month low of $58.38 a barrel.
"Saudi Arabia cutting supplies could be supportive," said Christopher Bellew at Bache Commodities, "But it could also be bearish, pointing to reduced demand from customers."
Earlier, the market had fallen more than a dollar, pressured partly by expectations that oil refiners will have to cut output because of weak demand for fuel.
All markets were awaiting the outcome of the U.S. presidential election.
Saudi Arabia's supply cut eases doubts about whether the world's top exporter would comply quickly with a 1.5 million barrel per day output cut agreed by the Organization of the Petroleum Exporting Countries in Vienna last month.
Other OPEC members have also cut back.
The United Arab Emirates has reduced its production to around 2.3 million barrels per day (bpd) from around 2.5 million bpd, a top state oil company official said on Tuesday.
Qatar has cut exports to Asia by about 40,000 barrels per day (bpd) from this month, Energy Minister Abdullah al-Attiyah told Reuters.
Crude oil has plummeted from a record above $147 a barrel in July as the credit crisis in the global banking sector has started to hit the wider economy. This has already dampened fuel consumption in the United States, the world's top oil consumer, and other major consumer nations.
U.S. auto sales plunged 32 percent in October to lows unseen in a quarter century, while U.S. factory activity -- a barometer for future oil demand -- fell to its lowest in 26 years.
(Additional reporting by Jane Merriman)
