Oil prices have risen more than 3 per cent, reaching more than one-month highs amid signs that demand for crude was slowly increasing with China reporting increased refinery runs.
Brent crude was up $1.21 cents, or 3.9 per cent at $32.34 a barrel by 0707 GMT, after touching $32.44 the highest since April 14. Brent rose nearly 7 per cent on Thursday and is heading for a 3 per cent gain for the week after rising the previous two weeks.
West Texas Intermediate (WTI) oil was up 92 cents, or 3.3 per cent, at $28.48 a barrel after reaching $28.54, the highest since early April. WTI rose 9 per cent in the previous session and is also heading for a third weekly increase, up about 15 per cent.
Amid supply cuts by the Organisation of the Petroleum Exporting Countries (OPEC) and other major producers, there are also some positive signs on the demand side.
Recent data released showed China’s daily crude oil use rebounded in April as refineries ramped up operations. However, the market mood remains less optimistic, with the coronavirus pandemic far from over and new cases emerging in some countries where lockdowns have been eased.
Barclays still raised its forecasts for Brent and WTI by $5-$6 a barrel for 2020 and by $16 a barrel for 2021.
The International Energy Agency said it expects global crude inventories to fall by about 5.5 million barrels per day (bpd) in the second half of this year.
On the production side, the OPEC+, had already agreed to cut output by a record of nearly 10 million bpd before Saudi Arabia this week extended its planned reductions for June, pledging to lower supply by nearly 5 million bpd.