Oil prices rose to their highest level since November 2018 on Monday, driven upwards by OPEC’s ongoing supply cuts, U.S. sanctions against Iran and Venezuela, fighting in Libya as well as strong U.S. jobs data. U.S. West Texas Intermediate crude were up 27 cents at $63.35 per barrel.
International benchmark Brent futures were up 31 cents at $70.65 per barrel around 8 a.m. ET (1200 GMT) on Monday, up 28 cents, or 0.4 percent from their last close.
Brent and WTI both hit their highest since November at $70.86 and $63.53 a barrel, respectively, early on Monday.
To prop up prices, OPEC and non-affiliated allies like Russia, known as OPEC+, have pledged to withhold around 1.2 million barrels per day of supply this year.
“OPEC’s ongoing supply cuts and U.S. sanctions on Iran and Venezuela have been the major driver of prices throughout this year,” said Hussein Sayed, chief market strategist at futures brokerage FXTM.
“However, the latest boost was received from an escalation of fighting in Libya which is threatening further supply disruption,” he added.
Strong U.S. jobs data on Friday also still supported markets on Monday.
Despite the host of price drivers, there remain factors that could bring oil down later this year.
Russia is a reluctant participant in its agreement with OPEC to withhold output and it may increase production if the deal is not extended before it expires on July 1, Energy Minister Alexander Novak said on Friday.
Another key architect of the OPEC-Russia deal, Kirill Dmitriev, the head of Russia’s direct investment fund, said on Monday OPEC and allies should raise output from June. Dmitriev previously said it was too early to pull back from cuts.
Russian oil output reached a national record high of 11.16 million bpd last year.
In the United States, crude production reached a global record 12.2 million bpd in late March. U.S. crude exports have also risen.
“With the new Permian pipelines (from July), we can see a boost of 500,000 to 600,000 bpd in U.S. exports,” said energy consultancy FGE in a note.
There also remain concerns about the health of the global economy, especially should China and the United States fail to resolve their trade dispute soon.
“Global demand has weakened, and existing tariffs on Chinese goods shipments to the U.S. are providing an additional drag,” rating agency Moody’s said on Monday, although it added that Chinese stimulus measures would likely support growth over 2019.