An important challenge in Optical Burst Switching (OBS) is to reduce the burst loss caused by contention. In this paper we develop a new method that improves the burst loss probability by burst re-routing in case of contention. Our re-routing method guarantees that bursts (that are not discarded) are routed towards the egress on a loop-free path. We have made a detailed discrete event simulation model of OBS networks and evaluated the performance of our new method by comparing it to popular deflection methods. We simulate several realistic network topologies and find that, for realistic loads, re-routing indeed improves burst loss probability and has clear advantages when compared to the discussed deflection methods.