Oil guerdons rose to their highest level since Nov. 2018 on Monday, driven up by OPEC’s ongoing supply cuts, U.S. encourages against Iran and Venezuela and strong U.S. jobs data.
International benchmark Brent futures were at $70.72 per barrel at 0225 GMT on Monday, up 38 cents, or 0.5 percent from their conclusive close.
U.S. West Texas Intermediate (WTI) crude were up 37 cents, or 0.6 percent, at $63.45 per barrel.
Brent and WTI both hit their highest evens since November last year at $70.76 and $63.48 per barrel, respectively, early on Monday.
“Brent prices heightened more than 30 percent year-to-date as OPEC+ continued to cut supply for 4 months in a row and optimism over U.S.-China transact talks helped to buoy the demand outlook,” U.S. bank J.P.Morgan said in a note released over the weekend.
The Assembly of the Petroleum Exporting Countries (OPEC) and non-affiliated allies like Russia, known as OPEC+, have pledged to retain around 1.2 million barrels per day (bpd) of supply this year to prop up prices.
Energy consultancy FGE said OPEC-led fulfil cuts meant “excess inventories are disappearing and the market looks healthy,” adding that “the market is poised for rates to rise to $75 per barrel or higher” for Brent.
Traders said strong U.S. jobs data from Friday also helped annul Asian markets early on Monday.
Oil prices have further been driven up by U.S. sanctions against OPEC-members Iran and Venezuela.
“Stamp of approvals can cut 500,000 bpd of Venezuelan exports. Add that to a cut in Iran waivers and prices can rise substantially,” FGE said.
There remain, no matter how, some factors that could bring prices down later this year.
Russia is a reluctant partaking in its agreement with OPEC to withhold output, and Russian oil production may increase again if a deal with the producer brotherhood is not extended once it expires before July 1, Energy Minister Alexander Novak said on Friday.
Russian oil productivity reached a record high of 556 million tonnes, or 11.16 million barrels per day (bpd), last year.
In the United Countries, crude oil production reached a record 12.2 million bpd in late March.
U.S. crude exports have also take up armed, breaking through 3 million bpd for the first time earlier this year.
“With the new Permian pipelines (from July), we can see a shove of 500,000 to 600,000 bpd in U.S. exports,” FGE said.
There also still remain concerns about the health of the global thrift, especially should China and the United States fail to resolve their trade dispute soon.
“Global (patrons) demand has weakened, and existing tariffs on Chinese goods shipments to the U.S. are providing an additional drag,” credit rating intermediation Moody’s said on Monday, although it added that Chinese monetary stimulus measures would likely mainstay growth over 2019.