Furthermore, higher demand for oil in 2018 has been anticipated by the Organization of the Petroleum Exporting Countries. OPEC also estimated an increase in demand.
Georgi Slavov, the head of research at commodities brokerage Marex Spectron, said he did not expect demand for crude oil to rise significantly in the final quarter of this year, which meant supply would have to be restricted even more tightly.
Crude inventories rose for a third straight week, by 4.6 million barrels in the week ending September 15, the Energy Information Administration said today. The move is a bid to support oil prices which have fallen dramatically from over $110 a barrel in 2014, mainly due to a glut in supply and a failure of demand to keep pace, particularly with USA shale oil producers adding to global oil supplies. Earlier this week, Iraqi Oil Minister Jabbar al-Luaibi said he and ministers from other oil-producing nations think production should be reduced by an additional one per cent.
US crude futures climbed 1.2% to $50.09 a barrel, and Brent rose 1.2% to $55.80 per barrel. Total volume traded was about 39 percent below the 100-day average.
Brent for November settlement advanced $US1.15 to end the session at $US56.29 a barrel on the London-based ICE Futures Europe exchange, the highest level since March.
Global crude oil prices slipped slightly Monday but stayed close to multimonth highs as traders braced for a potential stockpile build, expected later this week.
OPEC and 10 producers outside the cartel, including Russian Federation, agreed late previous year to cap production at around 1.8 million barrels a day lower than peak October 2016 levels; part of an effort to alleviate the global oil glut and boost prices. "All in all, things are fairly constructive", said Brian Kessens, who helps manage $US16 billion in energy assets at Tortoise Capital Advisors LLC.
"We have more work to do to get supplies back up to normal so that should be very bullish for crude oil", Phil Flynn, senior market analyst at Price Futures Group in Chicago, said by telephone.
Crude inventories rose for a third straight week, building by 4.6 million barrels, about a million more barrels than forecast. Oct. WTI was up 93 cents, or 1.9%, to finish at $50.41/bbl on contract's expiration day.