Oil prices appreciated on Monday, June 12, to break a three-day losing streak, after futures traders increased their bets on a renewed price upswing.
Brent crude futures LCOc1 had risen 23 cents to $48.38 per barrel by 0900 GMT, while U.S. West Texas Intermediate (WTI) crude futures CLc1 gained 17 cents to $46.00 per barrel.
Traders said the price rises came as data showed speculative traders had increased their investment in crude futures by taking on large volumes of long positions.
Brent and WTI futures have lost around 10 percent in value since May 25, when the Organization of the Petroleum Exporting Countries and 11 of its partners extended a restriction on supply into the first quarter of 2018.
“Oil bulls have reset for a technical bounce,” said Stephen Schork, author of the Schork Report.
While financial traders have confidence in rising prices, the physical market remains under pressure, especially due to a rise in U.S. drilling for new oil production.
U.S. drillers added eight oil rigs in the week to June 9 RIG-OL-USA-BHI, bringing the total count to 741, the most since April 2015, energy services firm Baker Hughes Inc (BHI.N) said on Friday, Reuters reports.
Soaring U.S. output undermines OPEC-led efforts to cut almost 1.8 million bpd of production until the first quarter of 2018 in order to prop up prices.
Saudi Arabia will supply full contracted volumes of crude to at least five Asian buyers in July, industry sources with knowledge of the matter said on Monday.
The oil price hit one-month lows last week, as evidence of rising output beyond the United States, in the likes of Libya and Nigeria, added to investor bearishness over supply.
