Oil prices climbed on Friday to their highest levels in a year, extending a run of strong gains on signs of economic growth in the United States and a continued commitment by producers to hold back crude supply.
Brent crude futures climbed 28 cents, or 0.5, to 59.12 a barrel by 0730 GMT, after hitting a high of 59.41, its highest since Feb. 20 last year. Brent is on track to rise 6 this week.
U.S. West Texas Intermediate WTI crude futures were up 29 cents, or 0.5, to 56.52 a barrel, after touching a high of 56.84, its top since Jan. 22 last year. The benchmark contract is on track for a weekly gain of 8.
Rising confidence in an upturn in economic and oil demand recovery around the corner is a major impetus for crude, said Vandana Hari, energy analyst at Vanda Insights.
Right now, the concurrent tightening of supply due to the additional Saudi cuts is adding to the tailwinds, Hari said. Brent may be well on its way to the 60 milestone.
In a sign of tightening crude oil supplies, the sixmonth backwardation in Brent and WTI futures when the price for prompt delivery is higher than the price for future delivery jumped to 13month highs for both contracts at 2.41 and 2.30 a barrel, respectively.
Markets were encouraged by strongerthanexpected orders for U.S. goods in December, pointing to strength in manufacturing, and hopes for swift approval by lawmakers of President Joe Bidens proposed 1.9 trillion coronavirus aid plan.
OPEC discipline has been a real positive,…