U.S. crude oil prices rose above $50 per barrel on Monday and were near last week’s multi-month highs as the number of U.S. rigs drilling for new production fell and refineries continued to restart after getting knocked out by Hurricane Harvey.
Oil was on its highest on Monday after quite some time as demand from refineries quadrupled and total number of US rigs were down by a substantial number.
U.S. West Texas Intermediate (WTI) crude futures were at $50.77 per barrel, and close to the more than three-month high of $50.50 reached last Thursday. It is currently being traded at 50.74 with +0.57%
Brent crude futures, benchmark for oil prices outside the United States, were at $55.71 a barrel, up 9 cents and not far from the almost five-month high of $55.99 touched on Thursday.
“Demand forecasts from OPEC and IEA … continued to improve sentiment in the market. Refineries are also reporting a much better recovery from the recent hurricanes,” ANZ bank said on Monday.
Oil refineries across the Gulf of Mexico and the Caribbean were restarting after being shut due to hurricanes Harvey and Irma, which battered the region over the past three weeks.
Despite these signs of a tightening market, analysts warned that distortions from the recent hurricanes made it hard to identify more long-lasting supply and demand fundamentals. Hedge funds and other money managers cut their bullish bets on U.S. crude futures and options in the week to Sept. 12, the U.S. Commodity Futures Trading Commission reported on Friday.