Oil rises 3 pct as Kuwaiti strike cut output for third day

Oil prices jumped more than 3 percent on Tuesday after a strike by workers in Kuwait nearly halved the OPEC member's crude production, overshadowing bearish sentiment after Sunday's failure by producers to agree to freeze output levels. Thousands of Kuwaiti oil workers downed tools for a third day on Tuesday to protest against planned public sector pay reform, cutting crude output to 1.5 million barrels per day (bpd), according to an oil spokesman cited by news agency KUNA. Reports of power outages leading to output declines of about 200,000 bpd in Venezuela and a pipeline fire in Nigeria that may have cut production by 400,000 bpd, along with the upcoming refinery maintenance season boosted the rebalancing of market and was supporting prices, traders said. The rally was catalyzed by the S&P 500 index crossing a key level that triggered buying in oil and across commodities. Analysts, however, said Kuwait's disruption would likely be brief and investors would soon focus back on the market's oversupply given the failure of major exporters on Sunday to agree to freeze output to avoid worsening the glut. A deal to freeze oil output by OPEC and non-OPEC producers fell apart at the weekend meeting in Doha after Saudi Arabia demanded Iran join in despite calls on Riyadh to save the agreement and help prop up crude prices. Tehran's crude oil exports have risen to around 1.75 million bpd so far in April, according to an industry source and shipping data. Exports averaged about 1.6 million bpd in March. 

        

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