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Oil bounces on speculation of Iran supporting Opec freeze action

[NEW YORK] Oil prices jumped as much as 2 per cent on Tuesday, reversing early losses, after Reuters reported that Iran was sending positive signals that it may support joint Opec action to prop up the market.

Brent crude was up 87 cents, or 1.8 per cent, at US$50.03 a barrel by 11:02 am EDT (1502 GMT). It had fallen 1.4 per cent earlier to US$48.48.

US crude jumped 70 cents, or 1.4 per cent, to US$48.11.

Iran, the third-largest oil producer in the Organization of the Petroleum Exporting Countries, has been boosting output since the lifting of Western sanctions in January and refused in April to join an Opec production freeze plan.

Though Iran has not officially announced whether it will join a new effort to curb production at a meeting of Opec and other producers in September, Tehran appears to be more willing to reach an understanding on the matter, sources in Opec and the oil industry told Reuters.