By Alison Sider, Sarah McFarlane and Biman Mukerji

Oil futures reversed earlier gains to settle lower on Thursday as a stronger dollar outweighed hopes that major oil producers will come to a deal to limit output.

U.S. crude futures lost 15 cents, or 0.33%, to $45.42 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, lost 14 cents, or 0.3%, to $46.49 a barrel.

The move lower came after crude hit a weekly high of $46.58. But in the absence of signs that the Organization of the Petroleum Exporting Countries has made more progress reaching an agreement on how to implement production cuts, the dollar's strength took precedence, analysts said.

"As the day progressed, the dollar re-exerted itself and crude rolled over," said John Saucer, vice president of research and analysis at Mobius Risk Group. "Something would have had to offset the dollar. Today there was none of that."

The U.S. dollar rose after comments from Federal Reserve Chairwoman Janet Yellen raised expectations that the central bank will raise interest rates next month. The WSJ Dollar Index was recently up 0.59%--its ninth consecutive day of gains. A stronger dollar makes oil, which is priced in the U.S. currency, more expensive for foreign buyers.

Market participants are still focused on OPEC's Nov. 30 meeting. Ongoing talks between members and nonmembers are expected to take place in the lead up, as they look to curb production to stabilize prices.

Saudi Energy Minister Khalid al-Falih continued to bolster expectations on Thursday, telling Saudi-owned Al Arabiya television that he is "optimistic" that OPEC's members will formalize the tentative deal they reached in September and set production limits for individual countries.

His comments came a day after media reports quoted Russian Energy Minister Alexander Novak as saying that Russia would "support any decision" adopted by OPEC.

"Verbal intervention by key players is keeping hope alive," said John Kilduff, founding partner of Again Capital. "They keep talking this up, the market keeps biting on the lure, and here we are."

OPEC, the 14-nation cartel that controls over a third of the world's oil, is trying to formalize a deal to cut production to between 32.5 million and 33 million barrels a day from record levels of 33.83 million barrels a day in October.

Oil ministers from Saudi Arabia, Russia and Qatar are expected to meet on the sidelines of the Gas Exporting Countries Forum, taking place in Doha on Thursday, according to people familiar with the plans. But ministers from Iraq and Iran, two countries that have resisted an agreement, aren't expected to attend.

There is widespread skepticism over whether OPEC will be able to achieve its goal given some producer nations have asked to be exempted from any output cut deal, plus the group has a patchy record for its members sticking to output quotas.

But analysts say that Saudi Arabia's commitment to a deal makes it hard to discount the possibility of an agreement.

"With Saudi Arabia driving the process, we've been continually optimistic that the deal will get done even though the market has sort of lost faith," Jason Bloom, Director of research and strategy for commodities and alternatives at Invesco PowerShares.

Gasoline futures are up 2.39 cents, or 1.81%, to $1.343 a gallon. Diesel futures rose 1.2 cents, or 0.84%, to $1.447 a gallon.

Write to Alison Sider at alison.sider@wsj.com and Sarah McFarlane at sarah.mcfarlane@wsj.com

(END) Dow Jones Newswires

November 17, 2016 15:50 ET (20:50 GMT)

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