- Oil benchmarks are trading within a striking distance from 2019 highs.
- OPEC’s extension of supply cuts is likely boding well for prices.
- A pullback cannot be ruled out though if the US reports a big inventory buildup.
Oil prices on both sides of Atlantic are reporting moderate gains at press tie just below the yearly highs clocked last week.
Brent oil is currently trading at $67.60 per barrel, representing a 0.27 percent gain on the day, but slightly down from the 2019 high of $68.12 clocked last Thursday.
Meanwhile, WTI oil is flatlined at $59.10, having clocked a yearly high of $59.21 yesterday.
The Organization of the Petroleum Exporting Countries (OPEC) on Monday canceled its planned meeting in April, thereby extending supply cuts first initiated in January.
With the cartel doing its bid to support its prices, traders have little reason to sell oil.
Further, with major central banks adopting a dovish stance, there is a growing feeling that demand-side pressures may not see significant deterioration, as previously feared.
Even so, the bullish momentum may stall if the US oil output continues to surge, having soared by more than 2 million barrels per day (bpd) since early 2018, to around 12 million bpd.
As for today, a price pullback could be seen if the Energy Information Administration (EIA) reports a big US inventory build up. The data is scheduled for release in the US session.
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