Brent settled up 53 cents, or 0.9%, to $61.06 a barrel. U.S. West Texas Intermediate crude (WTI) for March was at $58.36 a barrel, up 39 cents or 0.7%, Reuters reported.
The session peaks for both benchmarks were the highest since January 2020.
“With Brent over $60, it’s been great psychologically ... and everyone is feeling bullish about stronger demand and global inventories in further decline,” said John Kilduff, partner at Again Capital LLC in New York.
The markets have rallied since November as COVID-19 vaccines are being distributed worldwide, and as governments and central banks deploy huge stimulus packages to boost economic activity.
Top exporter Saudi Arabia is curbing supply in February and March, on top of cuts by fellow producers in the Organization of the Petroleum Exporting Countries and their allies, prompting forecasts of a supply deficit this year.
“The Saudis’ intent to eliminate a global supply surplus appears to be on track and capable of boosting crude prices further,” said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois.
Benchmark crude also drew support from the dollar’s fall to a one-week low, making greenback-denominated commodities more attractive to holders of other currencies. [USD/1]
U.S. crude inventories have fallen to their lowest since March, before the pandemic crushed the oil markets. Weekly U.S. oil inventory data is due from industry group the American Petroleum Institute at 4:30 p.m. EST (2130 GMT), followed by government data on Wednesday. [API/S]
The U.S. government on Tuesday lowered its outlook for crude oil production in 2021 to 11.02 million barrels per day from 11.1 million bpd previously forecast.
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