U.S. oil prices jumped to the highest levels in more than a year Thursday, while Brent crude topped $67 a barrel, as OPEC members agreed to extend their pact on production cuts into the month of April.
OPEC members, along with allies such as Russia, concluded their monthly virtual meeting, normally held in Vienna, Thursday and pledged to rollover its current rate of output, which is holding back around 9.2 million barrels from the market each day, until at least the beginning of May.
Saudi Arabia's influential Energy Minister, Prince Abdulaziz bin Salman, as well as Russia's Deputy Prime Minister Alexander Novak, had both argued against easing the curbs, which were introduced last year, citing fragility in global markets and uncertain demand.
"The uncertainty surrounding the pace of recovery has not receded," bin Salman said in his opening remarks. "At the risk of sounding like a stuck record, I would once again urge caution and vigilance."
WTI crude futures for April delivery, the benchmark for U.S. oil and gas prices, were marked $3.02 higher on the session at $64.30 per barrel, a level last seen in December 2019.
U.S. prices were also boosted by yesterday's weekly report on domestic crude stocks from the Energy Department, which showed a record 21 million barrel decline linked to the shuttering of refineries in Texas during the worst of the winter storms that gripped the region late last month.
Brent crude contracts for May delivery, which are more tightly-aligned to global prices, rose $3.10 per barrel to $67.16.
"We see oil demand rebounding at more than twice the rate suggested by recent history which indicates a relationship where every 1% of global economic growth equates to about 0.5% growth in oil demand," JPMorgan analyst Natasha Kaneva said in a recent client note. "Our economists now anticipate global economic growth to average 6.4% this year and we project oil demand expanding at a 6.7% rate as increased mobility amplifies the recovery."
"Despite this robust growth, we still see global demand only breaching the coveted 100 mbd level in December 2021," she added.