Summary Oil prices rose as investors hoped OPEC and non-OPEC producers were inching closer to a deal.
NEW YORK (Reuters) - Oil prices ended more than 4 percent higher on Tuesday as investors hoped OPEC and non-OPEC producers were inching closer to a deal to reduce output amid one of the biggest supply gluts in decades.
Crude surged after the Organization of the Petroleum Exporting Countries renewed calls for rival producers to cut supply alongside its members, but Russia, seen as key to any deal, has resisted so far.
Iraqi Oil Minister Adel Abdel Mahdi said he saw "some flexibility" for a deal, an idea that has been repeatedly mooted and dismissed for more than a year.
More afternoon buying emerged after U.S.-based global oil producer Hess Corp said it planned to cut capital spending by 40 percent this year.
Brent crude settled up $1.30, or 4.26 percent, at $31.80 a barrel, rebounding from a decline at the start of the session to top out at $32.72.
U.S. crude settled $1.11, or 3.7 percent higher, at $31.45 a barrel, almost a $1 off its high of $32.41.
Overnight, crude faced headwinds from weakness in Asian stock markets and a drop in annual rail freight volume in China, which added to the picture of economic slowing in oil s second largest market.
Last Wednesday Brent hit its lowest price since November 2003 at $27.10, before rebounding 15 percent on Thursday and Friday.
"The need for a reduction in output is clear – as it has been to us for the past 18 months – but it remains uncertain whether Saudi Arabia and its allies within OPEC are ready to return to the bargaining table," Tim Evans, energy futures specialist at Citi Futures wrote in a note.
