The Organization of the Petroleum Exporting Countries (OPEC) and allies that include Russian Federation - a group known as OPEC+ - could approve deeper crude output cuts when they meet in Vienna this week.
Global benchmark Brent crude was trading at $61.28 per barrel at 0623 GMT on Wednesday for a 0.13% gain after it closed Tuesday at $61.20 a barrel.
U.S. West Texas Intermediate (WTI) crude CLc1 futures were up by 31 cents, or 0.6%, at $56.41.
"The global oil supply-demand balance requires an extension of the current OPEC+ cuts", Goldman Sachs Group Inc. analysts including Damien Courvalin wrote in a report.
Oil prices steadied around $61 a barrel on Tuesday as rising expectations of deeper output cuts from OPEC and its allies were countered by a potential delay to a US-China trade agreement until after the next US presidential election.
People familiar with the trade talks said that U.S. President Donald Trump's comments Tuesday downplaying the urgency of a deal shouldn't be understood to mean the talks were stalling, as he was speaking off the cuff.
The CEO of Lukoil, one of Russia's biggest producers, has said he sees no reason to extend the cuts beyond March.
OPEC oil output fell in November as Angolan production slipped due to maintenance and Saudi Arabia kept a lid on supply to support prices before the initial public offering of state-owned Saudi Aramco, a Reuters survey found.
But some nations such as Iraq have been ignoring the agreement and producing more than their allotted amount.
"If they just keep the existing situation, then you get this massive oversupply", said Jacques Rousseau, managing director at Clearview Energy Partners.
JP Morgan said it expected producers to agree cuts of 1.5 million bpd to the end of 2020 - an increase of 300,000 bpd - as Saudi Arabia needs oil prices in the area of $60-70 per barrel.
"Iraq has surpassed its production target this month every month", said Rousseau.
And even if members of the cartel cut back on production, IHS Markit adds more oil from non-OPEC countries like the US, Canada, Brazil, Norway and Guyana, which will more than offset a decline in production.
In the meantime, Russia, which is not part of OPEC but has continued to expand its lead in production limits in recent years, has announced that it wishes to recalculate oil production in line with OPEC countries.
Much depends on how US onshore shale producers react to OPEC's plans.
"If something goes awry with Saudi production in the next few months, and there's a fairly good chance something will happen".