Oil prices gained noticeably on Monday, bolstered by production cuts and hopes of a pickup in crude demand.
The West Texas Intermediate for June delivery climbed 2.39 U.S. dollars to settle at 31.82 dollars a barrel on the New York Mercantile Exchange, while Brent crude for July delivery rose 2.31 dollars to close at 34.81 dollars a barrel on the London ICE Futures Exchange.
"The upswing has been boosted by the high production cuts being implemented by OPEC and its allies plus the (involuntary) decline in production in the U.S. on the one hand, and hopes of demand soon returning on the other," Eugen Weinberg, energy analyst at Commerzbank Research, said in a note on Monday.
"Despite all the euphoria, however, we believe that caution is still advisable: it will probably take some years before demand recovers to its pre-crisis level," he added.
The Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC+, agreed to cut output by 9.7 million barrels per day for May and June, aiming to tackle a global supply glut on the back of the COVID-19 crisis.
Oilfield services company Baker Hughes reported on Friday that the number of active U.S. rigs drilling for oil plummeted from 292 to 258, the lowest figure since July 2009.
Editor:Cherie
