OIL prices rose to 10-month highs above $US72 ($84) overnight on expectations that recovering refinery operations in the United States and ongoing supply restrictions will cut into global oil inventories.
Analysts expect weekly US oil data on Thursday to show a decline in crude oil inventories as more US refineries resume operations after an unusually long and extensive spring maintenance season.
ConocoPhillips began a restart of a gasoline-making unit at a Texas refinery Friday, while one of two shut crude units at a BP refinery in Indiana will reach full rates within two to three weeks.
London Brent crude, currently a better indicator of global oil market fundamentals than US crude, rose $US1.22 to settle at $US72.63 per barrel, the highest level since August. US crude also reached a 10-month high, rising US41 cents to $US71.09.
Oil output disruptions in Nigeria and supply cuts by the Organisation of the Petroleum Exporting Countries (OPEC), have helped Brent climb 17 per cent this year.
"US crude oil stocks will draw in the next two months as there is little room to build further and as refineries increase their intake," said Olivier Jakob, analyst at Petromatrix.
The International Energy Agency warned overnight that crude oil demand from refineries would rise sharply in the coming weeks and repeated its call for the Organization of Petroleum Exporting Countries to increase oil production.
OPEC is not due to meet until September and Saudi Arabia and other OPEC members want global oil inventories to fall from their current levels before they increase production, a Gulf official familiar with the kingdom's policies told Reuters.
source:www.news.com.au
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