The bulls are running loose! Climbing more than 20% since June, crude oil futures rose sharply higher on Monday for both benchmarks, according to Bloomberg MarketWatch.
October West Texas Intermediate crude jumped $1.56, or 3.1%, to settle at $52.22 a barrel on the New York Mercantile Exchange. Prices saw their highest settlement since mid-April.
November Brent crude, the global benchmark, climbed $2.16, or 3.8%, to end trading at $59.02 a barrel on the ICE Futures Europe Exchange, marking the highest front-month contract finish since early July 2015.
“Oil prices have been going higher in recent weeks due, first and foremost, to evidence that OPEC and Russia’s efforts to reduce the global supply glut was showing positive results, and that the group was somewhat surprisingly sticking to their agreement,” said Fawad Razaqzada, technical analyst at Forex.com.
“Talks that the production cuts could be extended has been providing further confidence to oil investors that the rally could be sustained,” said Razaqzada.
On Friday, an OPEC committee declared record compliance of 116% in August for the countries that are part of the production curb agreement.
The spread between Brent and WTI, which widened to $6.20 by the close of last session, hasn’t been as wide since the U.S. lifted its ban on oil exports nearly two years ago, according to analysts at JBC Energy. They indicated that they fully expected the wide spread to result in record crude exports out of the Gulf Coast. That should narrow the difference between the two crude benchmarks, according to JBC Energy analysts.
Back on the New York Mercantile Exchange, October natural gas fell by 4 cents, or 1.4%, to settle at $2.919 per million British thermal units.
