Brent crude, the global oil marker, clocked its longest winning streak in eight months on Monday as concerns about supply disruptions in the Middle East helped lift oil prices.
Brent crude settled 1.3 per cent higher at $55.98 a barrel — settling in the green for the sixth consecutive day, its longest winning streak since August.
Meanwhile, West Texas Intermediate, the US crude marker, settled 1.6 per cent higher at $53.08 a barrel, advancing for the fifth straight day in its longest streak of gains since December.
US airstrikes on a Syrian airbase last week that was the launchpad of a chemical attack on civilians raised concerns about the implications of such an attack on supply disruptions in the Middle East.
Oil prices have also shifted higher in recent weeks as inventory data in March proved encouraging as demand looked strong and evidence of Opec cuts starting to show in the data.
“This March has seen gasoline demand increase a robust 617k bpd on average, distillates demand grow an average of 199k bpd, and refinery demand for crude rise 313k bpd over the month,” said Ryan McKay at TD Securities. He added:
This is quite encouraging for the oil market, as product demand is only expected to increase during the summer driving months, leading to increased refinery runs and more crude oil uptake. Given the strength in consumption we have already started seeing throughout March, we believe that, due to the OPEC cuts and further improvements in demand, there will be larger-than-expected draws throughout the summer, which should paved the way to our $60/bbl target.
Monday’s rally in oil prices also helped lift shares of energy companies. Indeed, the S&P 500 energy sector rose 0.8 per cent and was the biggest gainer on the benchmark index.
Meanwhile, US stocks gave up most of their gain to finish the day broadly flat. The S&P 500 finished the day up 0.07 per cent to 2,357.16, the Dow Jones Industrial Average ended the day little changed at 20,658.02, while the Nasdaq Composite finished the day up 0.05 per cent to 5,880.93.