Oil extends gains as Brent tops $60 mark

Crude-oil futures rose, extending sharp overnight gains, with Brent crude testing the $60 mark on reports of spending cuts by oil companies and a weaker US dollar.

Brent crude for April delivery  rose 86 cents, or 1.5 percent, to $60.14 a barrel on London’s ICE Futures exchange. Both Nymex West Texas Intermediate and ICE Brent crude settled 4 percent to 5 percent higher in the last trading session, snapping a two-day losing streak and posting gains for eight of the last 11 trading sessions.

Oil prices have swung wildly since their recent 20 percent rally as some traders entered the market at low prices expecting that prices have bottomed, while others booked profits when prices rose.

Prices have settled higher or lower by more than 2 percent for 10 straight trading days, the longest streak of this kind since the 21-day period from December 4, 2008 to January 5, 2009.

Meanwhile, oil prices are supported by reports of more spending and job cuts by oil companies. Company announcements made so far this year indicate that oil companies that account for around 49 percent of the global oil and gas spending budget intend to spend 16 percent less on exploration and production in 2015, according to Barclays estimates.

It says the larger spending cuts are expected among Asian oil companies, with the CAPEX budgets for state-run entities expected to decline by 19 percent in 2015.

Sentiment was also positive in wider financial markets after Germany and France brokered a deal with Russia to end fighting in Ukraine.

In Greece, leaders struck a conciliatory tone with the rest of the Eurozone after an unsuccessful meeting of finance ministers. Greece is now running out of time to reach a new deal before its current bailout program expires at the end of February and the probability of a collapse of negotiations is significant, consulting firm IHS said in a report.