TOKYO (Reuters) – Oil prices rose to their highs in about 13 months on Monday as fears of heightened tensions in the Middle East sparked new purchases, while hopes that a US stimulus and easing of lockdowns will boost fuel demand. stimulate, supported.
Brent crude rose $ 1.09, or 1.8%, to $ 63.52 a barrel at 0428 GMT, after climbing to a session high of $ 63.76, the highest level since January 22, 2020.
US West Texas Intermediate (WTI) crude oil futures rose $ 1.28, or 2.2%, to $ 60.75 a barrel. It hit its highest since Jan. 8 last year of $ 60.95 earlier in the session.
Oil prices rose by about 5% last week.
The Saudi-led coalition fighting in Yemen said late on Sunday that it intercepted and destroyed an explosive-laden drone fired at the kingdom by the Iran-linked Houthi group, state television reported, sparking fears of renewed tensions in the Middle East. .
“An early spike in the oil markets was caused by the news,” said Kazuhiko Saito, chief analyst at commodity broker Fujitomi Co.
“But the rally was also fueled by growing hope that a US stimulus and relaxation of lockdowns will boost the economy and fuel demand,” he said. WTI can be pulled back by taking profits as it hit a key USD 60 level, he added.
US President Joe Biden pushed for the first major legislative feat of his tenure on Friday, and turned to a bipartisan group of local officials for help with his $ 1.9 trillion coronavirus plan.
Oil prices have also risen in recent weeks as supplies have become tight, largely due to production cuts from the Organization of the Petroleum Exporting Countries (OPEC) and related producers in the OPEC + group.
“In addition, robust global equity markets boosted investors’ risk appetite,” said Satoru Yoshida, a commodities analyst at Rakuten Securities.
Asian stocks hit record highs on Monday as the successful rollout of coronavirus vaccines worldwide sparks hopes for a speedy economic recovery amid new fiscal support from Washington.
“With cheap cash supplies amid global monetary easing, rapid vaccine rollouts and tight supplies from OPEC + and US shale oil producers, crude oil prices could soar to $ 70 a barrel,” said Yoshida.
Reporting by Yuka Obayashi; Editing by Richard Pullin