Oil prices extended gains to multi-year highs, as global supply remained tight amid steady fuel demand in the United States and worldwide as economies recovered from the effects of the coronavirus outbreak.
WTI crude oil (NYMEX) for December rose by $0.63 or 0.75% to $84.39 a barrel by 0959 GMT. Similarly, the ICE Dec’21 Brent crude oil contract jumped by $0.51 or 0.60% to $86.04 a barrel by the same time.
Expectations of supply tightness continue to support oil prices, as OPEC+ sticks to its conservative approach for oil production amid a shaky demand recovery. Similarly, coal and gas shortages in China, Europe, and India have boosted oil prices, prompting a shift to fuel oil for power generation.
Petroleum prices are projected to remain strong as vaccine-driven global demand rebound and seasonal winter demand in the Northern Hemisphere eat away at crude stocks, keeping the market afloat. Recently stockpiles of oil at the hub of Cushing storage are continually draining.
Market players are now preparing for the next OPEC+ meeting, which is set for November 4th and is expected to review December production choices.