The TSX energy index rose 1.66 per cent Monday on speculation that OPEC will hold an emergency meeting to try to reverse the sharp drop in oil prices so far this year.

And that carried the TSX up 76.55 points to close at 12,755.

An oil worker shuts off a valve at an oil and gas facility near Basra, Iraq.
(Nabil al-Jurani/Associated Press)

The markets leapt forward after Javad Yarjani, the head of OPEC affairs at the Iranian Oil Ministry, told Associated Press Friday that the Organization of Petroleum Exporting Countries is considering further production cuts because oil prices have fallen by 13 per cent so far this year and by more than 30 per cent since the all-time high of $78.40 US last July.

Word of the OPEC action was enough to raise oil prices by $1.11 US on Friday from the 19-month low of $51.56 US.

The price of Brent crude oil for February delivery rose another 56 cents to $53.55 US a barrel on the ICE Futures exchange in London early Monday before falling back to $52.87 US, down 12 cents on the day.

February light sweet crude rose 17 cents to $53.16 US in electronic trading on the New York Mercantile Exchange by midday in Europe.

There was no floor trading on the New York Mercantile Exchange Monday because markets were shut down for Martin Luther King Jr. Day, a public holiday in the United States.

OPEC has had a hard time keeping oil prices up, despite high tensions in the Middle East, growing global energy demand and escalating violence in Nigeria.

OPEC has tried to bolster oil prices in recent months by announcing production cuts. But its efforts have been unsuccessful, largely because traders doubt the cuts are fully enforced.

It cut production by 1.2 million barrels a day in November and plans to cut another 500,000 barrels a day on Feb. 1.

Gasoline prices have fallen sharply in Canada in recent months. Regular gasoline was selling for under 70 cents a litre in Toronto Monday, a far cry from the $1.10 a litre reached last summer.

With files from the Associated Press