TOKYO- Oil futures rose for a fifth day, rising to their highest in almost six weeks, on optimism that OPEC and other producing countries may agree to extend output cuts to support prices.
Brent LCOc1 was up 31 cents, or 0.5%, at $62.90 a barrel by 0544 GMT, while U.S. West Texas Intermediate (WTI) futures CLc1 were 32 cents, or 0.6%, higher at $58.17 a barrel.
Brent earlier climbed to its highest since Aug. 1, while U.S. crude rose to the highest since July 31.
WTI gained more than 2% on Monday, while Brent finished the day 1.7% higher as the market reacted positively to the appointment by Saudi Arabia’s king of his son, Prince Abdulaziz bin Salman, as energy minister on Sunday.
Prince Abdulaziz, a long-time member of the Saudi delegation to the Organization of the Petroleum Exporting Countries (OPEC), said the pillars of Saudi Arabia’s policy would not change and a global deal to cut oil production by 1.2 million barrels per day would be maintained.
He added that the so-called OPEC+ alliance, made up of OPEC and non-OPEC producers including Russia, would be in place for the long term.
“It’s a lot of market movement on some pretty strong speculation … so maybe people are just excited that the Saudis are being pretty proactive on this front,” said Phin Ziebell, senior economist at National Australia Bank, referring to hopes for an extension of the production cuts.
The OPEC+ joint ministerial monitoring committee (JMMC), which reports on compliance with the cuts, is due to meet on Thursday in Abu Dhabi.
There have been concerns about producers’ adherence to the supply agreement as OPEC members Iraq and Nigeria, among others, exceeded their quota in August and Russia also did not fully comply as well.
“Markets will need to see concrete progress on the production front, even as the world’s economy slows, to sustain gains,” said Jeffrey Halley, senior market analyst at OANDA.
Should oil markets close higher on Tuesday it will be the longest run of gains since late July but headwinds remain as the U.S.-China trade war rumbles on.
Executives at the annual Asia Pacific Petroleum Conference said on Monday they expect oil prices this year to be pressured by uncertainties surrounding the global economy, the U.S.-China trade war and increasing U.S. supplies.
In the United States, crude stockpiles are likely to have fallen for a fourth consecutive week last week, a preliminary Reuters poll showed on Monday.
Five analysts polled by Reuters estimated, on average, that crude inventories fell 2.6 million barrels in the week to Sept 6.