Oil prices hit 11month highs and were on track for a weekly gain on Friday, supported by Saudi Arabias pledge to cut output and a global stocks rally as investors looked beyond rising coronavirus cases.
Brent crude climbed 83 cents, or 1.5, to 55.21 a barrel by 1202 GMT, the highest since late February, and U.S. West Texas Intermediate WTI gained 66 cents, or 1.3, to 51.49, also its highest level since late February.
Both were on track for weekly gains of more than 6.
The surprise Saudi cut is keeping bulls at the helm, said Stephen Brennock of oil broker PVM. It will take a brave man to bet against the current bullish run of play.
Saudi Arabia this week pledged extra, voluntary oil output cuts of one million barrels per day bpd in February and March as part of a deal under which most OPEC producers will hold production steady in the face of new coronavirus lockdowns.
However, analysts said oil prices could see a correction in coming months, if their rallies were not backed by stronger fuel demand.
Severe mobility restrictions around the world to contain a surge in COVID19 cases still weighed on fuel sales, weakening the prospect of energy demand recovery in the first half of 2021.
Oil markets are expected to stay in a bullish tone toward February, said Kazuhiko Saito, chief analyst at commodities broker Fujitomi Co.
But concerns over slower demand in gasoline and other fuels in the United States and other parts of the world due to wider restrictions to contain…