Oil hits 13-month highs on tighter supplies, Fed assurance on law rates

A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma, U.S., September 15, 2015. (Reuters)

SULAIMANI (ESTA) — Oil prices edged up on Thursday to the highest levels in more than 13 months, underpinned by monetary easing policies and lower crude production in the United States.

Brent crude futures for April rose 35 cents to $67.39 a barrel by 0607 GMT, while U.S. West Texas Intermediate (WTI) crude for April was up 24 cents at $63.46 a barrel.

Both contracts touched their highest since January 2020 earlier in the session with Brent at $67.44 and WTI at $63.67.

Reuters reported that an assurance from the U.S. Federal Reserve that interest rates would stay low for a while boosted investors’ risk appetite and global financial markets.

“Comments from Fed Chairman, Jerome Powell, earlier in the week relating to the need for monetary policy to remain accommodative have probably helped, but sentiment in the oil market has also become more bullish, with expectations for a tightening oil balance,” Reuters quoted ING analysts as saying.

A rare winter storm in Texas has caused U.S. crude production to drop by more than 10%, or 1 million barrels per day (bpd) last week, the Energy Information Administration said.

OPEC and their allies including Russia, a group known as OPEC+, is due to meet on March 4. They will discuss a modest easing of oil supply curbs from April given a recovery in prices, Reuters cited OPEC+ sources as saying.

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