Oil rises above $70 for first time since November
Crude oil capped its longest winning streak in almost 18 months as global supplies strained and positive US economic indicators bolstered the demand outlook.
Brent crude rose above US$70 per barrel on Friday for the first time since November. Futures in New York gained 4.9 per cent last week, joining a US stock-market rally that approached an all-time high.
Already boosted by fresh signs of OPEC production cuts, crude was further buoyed by a monthly US employment report that topped estimates.
Amid a mixed economic outlook, investors are ‘excited about any green shoots’, said Said Haidar, chief investment officer of macro hedge fund firm Haidar Capital Management in New York. “The market is extrapolating that we hit bottom earlier than expected. That’s bolstering all sorts of risk assets, including oil.”
Friday’s optimism was enough for traders to shrug off the biggest jump in American drilling activity since May 2018.
West Texas Intermediate (WTI) crude has climbed almost 40 per cent this year as the Organization of Petroleum Exporting Countries and allies trimmed production to prevent a glut. Escalating tensions in Libya and Venezuela have also supported prices, with worries about economic growth and booming US shale output providing the only checks on the rally.
WTI for May delivery advanced 98 cents to settle at US$63.08 a barrel. The five-week advance was the longest since November 2017.
Brent for June settlement gained 94 cents to US$70.34 on the London-based ICE Futures Europe exchange.