By Sarah McFarlane and Stephanie Yang

Oil futures bounced off a three-month low on Tuesday, bolstered by speculation that members of the Organization of the Petroleum Exporting Countries are working out the details of a proposed reduction in crude oil output.

Light, sweet crude for December delivery settled up $2.49, or 5.7%, at $45.81 a barrel on the New York Mercantile Exchange, its biggest one-day percentage gain since April. Brent, the global benchmark, rose $2.52, or 5.7% to $46.95 a barrel.

All eyes are now on OPEC ahead of the Nov. 30 meeting where the group aims to agree to a production cut to between 32.5 million and 33 million barrels a day from record levels of 33.83 million barrels a day in October.

"All of a sudden now there's hope, and that's why we're seeing the market rebound," said Phil Flynn, senior market analyst at The Price Futures Group.

There is growing consensus that OPEC will come to an agreement, though the cartel's ability to rebalance the market, which has been dogged by excess supply for several years, is more in doubt.

"Today's price recovery that has seen Brent climb back to above $45 per barrel comes courtesy of the latest diplomatic attempts by Qatar, Venezuela and Algeria to bring about a compromise at the OPEC meeting," said Commerzbank.

Oil has taken most of its cues from sentiment on the OPEC deal in recent weeks. Until the November meeting, headlines should continue to influence prices, analysts say. "This is typical of OPEC negotiations. 'We have a deal, we don't have a deal,' and it goes till the last minute, " Mr. Flynn said.

Analysts noted concerns over pipelines in countries such as Nigeria helped support a move higher in oil prices. Robbie Fraser, commodity analyst with Schneider Electric, said the possibility that instability and supply disruptions will continue has also made investors more bullish on oil. "It's a pretty big combo in a pretty tight window here," he said, when added onto optimism over an OPEC deal.

OPEC is in a difficult position. Any cut would potentially trigger increased production elsewhere, leading to doubts over the effectiveness of the current scale of the agreement. Rising production in nonmembers including Brazil and Russia has exacerbated the global supply glut."We believe the amount of production cut that will be delivered will fall short of helping the market to rebalance in 2017, assuming recovery in Libya and Nigeria and stability in Venezuela," said Harry Tchilinguirian, head of commodity strategy at BNP Paribas. The bank expects global stocks to rise in 2017.

In contrast with other commodities and risky assets, oil prices had broadly been retreating over the past week, after Donald Trump's victory in the U.S. presidential election. Analysts attribute the recent losses to concern over the scale of the global crude oversupply.

In the U.S., the amount of production rose 2% for the week ended Nov. 4, the U.S. Energy Information Administration said last week. Mr. Trump is expected to support the growth of the domestic oil-and-gas industry.

Traders will be watching for the latest EIA data to be released at 10:30 a.m. ET on Wednesday for more clarity on the state of oil storage andproduction. Analysts and traders surveyed by The Wall Street Journal expect inventories to add an average of 1.1 million barrels of oil in the week ended Nov. 11. Refinery use is seen rising 0.8% on average to 87.9% of capacity, according to the survey.

Gasoline futures settled up 4.5% at $1.3350 a gallon, and diesel futures settled up 4.2% at $1.4439 a gallon.

--Dan Strumpf contributed to this article

Write to Sarah McFarlane at and Stephanie Yang at

(END) Dow Jones Newswires

November 15, 2016 16:21 ET (21:21 GMT)

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