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U.S. crude oil futures topped $80 a barrel for the first time in nearly four months, as signs point to a tightening market ahead of an OPEC+ decision on production cuts.
The West Texas Intermediate contract for April gained almost 3% or $2.31 to $80.57 a barrel, while May Brent futures added 2.5% or $2.03 to $83.94 a barrel.
U.S. crude and the global benchmark booked a second consecutive monthly gain in February as near month contracts traded at a premium to later months, typically a sign of a tightening oil market.
OPEC+ is considering rolling over its production cuts through the second quarter and possibly the end of the year, three sources in the organization told Reuters this week. The cartel and its allies are expected to make a decision on the cuts in the first week of March, sources told Reuters.
OPEC’s next formal Joint Ministerial Monitoring Committee meeting is scheduled for April 3.
Oil Prices, Energy News and Analysis
Brent crude futures could break out to the $95 per barrel range in the second quarter as bulls have become more aggressive in buying at ever higher lows, Paul Ciana, a technical analyst with Bank of America, told clients in a note Thursday.
A breakout through a resistance level near $85 per barrel for Brent would confirm a change to the upside, but the global benchmark will have to hold a support level of roughly $80 a barrel in March, Ciana said. If Brent falls below that level, the benchmark could drop all the way to the bottom of its range at $73-$75 a barrel, he said.
On the geopolitical front, cease-fire negotiations in the Israel-Hamas war are in jeopardy after scores of Palestinians were killed in Gaza City while waiting for humanitarian aid.
“I am rejecting the international pressure to end the war before we achieve all of its goals,” Israel Prime Minister Benjamin Netanyahu said in press conference Thursday.
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— CNBC’s Michael Bloom contributed to this report.