Brent crude oil futures were at 74.02 per barrel at 0020 GMT, up 16 cents, or 0.2 per cent, from their last close, but were some way below the November-2014 high of $ 75.47 a barrel reached the previous day.
US West Texas Intermediate (WTI) crude futures were up 14 cents, or 0.2 per cent, at $ 67.84 per barrel. That was also off the late-2014 highs of $ 69.56 a barrel reached earlier in April.
Overall, many analysts say an oil market slump that started in 2014 has now ended and is turning into a sustained price rally due to supply disruptions and also strong demand, especially in Asia.
That’s due to production cuts led by the Organization of the Petroleum Exporting Countries (Opec) which were introduced in 2017 with the aim of propping up the market, but also because of political risk to supplies in the Middle East, Venezuela and Africa.
“Market sentiment is turning increasingly bullish towards the commodity,” said Lukman Otunuga, research analyst at futures brokerage FXTM.
Despite this, Otunga said “the sustainability of the rally is a concern” as it was fuelled largely by political risk in the Middle East.
“With rising production from U.S shale still a key market theme that continues to weigh on oil prices, it will be interesting to see how much oil appreciates before bears enter the scene,” he said.
US crude oil production <C-OUT-T-EIA> has shot up by more than a quarter since mid-2016 to over 10.54 million barrels per day (bpd), taking it past Saudi Arabia’s output of around 10 million bpd. Only Russia currently produces more, at almost 11 million bpd.
US crude inventories rose by 1.1 million barrels in the week to April 20 to 429.1 million, according to a report by the American Petroleum Institute on Tuesday.
Official weekly US fuel inventory and crude production data will be published later on Wednesday by the Energy Information Administration (EIA).