By Alex Nussbaum and Jessica Summers
US crude capped its longest winning streak in almost 18 months as global supplies strained and positive US economic indicators bolstered the demand outlook.
Futures gained 4.9 percent for the week, joining a US stock-market rally that approached an all-time high on Friday. Already boosted by fresh signs of Opec production cuts, crude was further buoyed by a monthly employment report that topped estimates.
Amid a mixed economic outlook, investors are “excited about any green shoots,” said Said Haidar, chief investment officer of macro hedge fund firm Haidar Capital Management in New York. “The market is extrapolating that we hit bottom earlier than expected. That’s bolstering all sorts of risk assets, including oil.”
Friday’s optimism was enough for traders to shrug off the biggest jump in American drilling activity since May 2018.
West Texas Intermediate crude has climbed almost 40 percent this year as the Organization of Petroleum Exporting Countries and allies trimmed production to prevent a glut. Escalating tensions in Libya and Venezuela have also supported prices, with worries about economic growth and booming US shale output providing the only checks on the rally.
WTI for May delivery advanced 98 cents to settle at $63.08 a barrel. The five-week advance was the longest since November 2017.
Brent for June settlement gained 94 cents to $70.34 on the London-based ICE Futures Europe exchange. The global benchmark crude was at a premium of $7.19 to WTI for the same month.
Traders are focused on “Opec confirmation that they will continue to be disciplined. We are looking at potentially less output from shale, a mess in Venezuela and now there is risk in Libya,” said Bart Melek, head commodity strategist at Toronto Dominion Bank. “We’ve seen people get a lot more happy about going long in this environment.”
Prices have also been lifted this week by signs that the US and China are on track to resolve the trade dispute that threatens oil demand. US President Donald Trump said while any trade deal with China was probably still weeks away, both sides were making progress on an accord that could be “very monumental.”
Other oil-market news: Gasoline futures rose 1.5 percent to $1.9687 a gallon. Excluding production-sharing agreements, Russia has cut its average oil output in April by 225,000 barrels a day, Energy Minister Alexander Novak said in Moscow. US sanctions on Venezuelan and Iranian oil, as well as output cuts by the Saudi Arabia-led Opec+ group, are creating a shortage of heavy to medium crude that’s sulfurous and dense.