Oil prices climbed by more than $1 a barrel on Monday, with benchmark Brent hitting a one-month high and U.S. crude topping $30 supported by optimism about the re-opening of economies and output cuts by major producers.
Brent crude was up $1.21, or 3.7%, at $33.71 a barrel by 0912 GMT, its highest level since mid-April.
U.S. West Texas Intermediate (WTI) crude was up $1.59 or 5.4% at $31.02 per barrel, its highest since mid-March.
"Optimism on the demand side of the oil equation has helped prices climb further, with gasoline demand coming back as governments ease confinement measures," said Rystad Energy’s senior oil markets analyst Paola Rodriguez Masiu.
Summer weather is enticing much of the world to emerge from coronavirus lockdowns. Shops and restaurants prepared to reopen in Italy on Monday, while other centres of the outbreak such as New York and Spain gradually lifted restrictions.
The positive sentiment in the market was reinforced as U.S. Federal Reserve Chairman Jerome Powell issued an optimistic outlook for economic recovery later this year.
"Assuming there is not a second wave of the coronavirus, I think you will see the economy recover steadily through the second half of this year," Powell said Sunday night in broadcast remarks.
The June WTI contract expires on Tuesday, but there was little indication of it repeating a historic plunge below zero last month on the eve of the May contract's expiry.
However, analysts cautioned that demand was not expected to recover to pre-coronavirus levels any time soon.
"Clearly the fundamentals in the market are improving, but we continue to believe that the market is rallying too much too soon, with the risk that further strength will only prolong the supply and demand imbalance," ING analyst Warren Patterson said.
Also supporting oil prices are production cuts by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, a grouping known as OPEC+.
The world's top exporter Saudi Arabia announced last week that it would cut an additional 1 million barrels per day in June, while OPEC+ wants to maintain existing oil cuts beyond June when the group meets next.
Kuwait and Saudi Arabia have agreed to halt oil production from the joint Al-Khafji field for one month, starting from June 1, Kuwait's Al Rai newspaper reported on Saturday.
Production is also falling as U.S. energy firms cut the number of oil and natural gas rigs operating.
Reuters
Mon May 18 2020
The sun sets behind a crude oil pump jack on a drill pad in the Permian Basin in Loving County, Texas, U.S. November 24, 2019. Picture taken November 24, 2019 - REUTERS/Angus Mordant
Millions in Cuba still without power as major outage persists
Millions of Cubans remain without electricity because of a prolonged outage at the main power plants on the island, Anadolu Agency reported.
Surge in Gaza violence increases famine risk, monitor says
About 1.84 million people across the besieged Palestinian enclave are living through high levels of acute food insecurity.
Israel pounds Beirut and Gaza after rockets hit Israel's north
A drone was launched at Prime Minister Benjamin Netanyahu's holiday home.
Elon Musk promises to award $1 mil each day to a signer of his petition
He awarded a $1 million check to an attendee of his event in Pennsylvania aimed at rallying supporters behind Donald Trump.
Former special forces commander Prabowo to take up Indonesian presidency
Indonesia's Prabowo Subianto will take over as president of the world's third-largest democracy after sweeping the country's election with policies like free meals for school children
Father of Malaysian Islamic banking, Abdul Halim Ismail passes away
His dedication and pioneering spirit played an important role in shaping the journey of Bank Islam as well as leaving a lasting impact on the development of Malaysia's Islamic finance industry.
Zayn Malik postpones US tour dates after One Direction bandmate Liam Payne's death
Payne, 31, died on Wednesday after falling from a third-floor hotel room balcony in Buenos Aires, shocking fans of the boy band.
Why voters in a handful of swing states will decide the US presidential election
The contest will almost certainly be decided by just tens of thousands of voters a tiny fraction of the populace in a handful of states.
INSIGHT - Sudan's war risks 'lost generation' of children
A devastating crisis is unfolding in Sudan, where the most vulnerable members of society children are bearing the brunt of the violence.
Who is Prabowo Subianto, incoming president of Indonesia?
A wealthy ex-general with ties to Indonesia's popular outgoing president and its dictatorial past, looks set to be its next leader.
Trump says he would impose tariffs on China if China went into Taiwan
Republican presidential candidate Donald Trump said he would impose additional tariffs on China if China were to "go into Taiwan,"
Iran's supreme leader says Hamas leader's death will not halt 'Axis of Resistance'
The "Axis of Resistance", built up with years of Iranian support, includes Hamas, the Lebanese Hezbollah group, the Houthi movement in Yemen, and various Shi'ite groups in Iraq and Syria.
Putin says Russia willing to seek compromises between Iran and Israel
Russia is ready to help seek compromises between arch-foes Israel and Iran, President Vladimir Putin said on Friday, saying these would be difficult but possible.
What proposals will Russia push at the BRICS summit?
The proposal is also to establish a BRICS reinsurance company to allow uninterrupted shipment of goods and key commodities between members.
Indonesia's free meals plan in the spotlight as Prabowo readies for office
Prabowo calls the programme one of the main drivers of economic growth, eventually set to add an estimated 2.5 million jobs.
Astro AWANI's revamped English news website, AWANI International, launches on Oct 21
Astro AWANI's revamped English platform delivers in-depth global news and expert analysis to keep you informed on key developments.
Israeli strikes kill 33 people in Jabalia refugee camp in Gaza, medics say
Residents of Jabalia said Israeli tanks had reached the heart of the camp after pushing through suburbs and residential districts.
Liam Payne's ex-partner calls for media restraint after 'painful' death
Cheryl Tweedy used her statement to urge the media to remember they had a seven-year-old son, Bear, who could read the reports.
Analysts: Indonesia's strong MoF leadership team to boost investor confidence
Sri Mulyani Indrawati as head of Indonesia's Ministry of Finance is expected to instil confidence among investors.
Biden offers both a carrot and a stick to Israel as his term nears an end
Israel has frequently resisted US advice and has caused political difficulties for the Biden administration.