Oil prices settled higher on Tuesday, with Brent hitting above 71 and trading at its highest since March, on expectations for growing fuel demand during the summer driving season in the United States as OPEC agreed to boost output.
Brent crude futures for August settled up 93 cents, or 1.3, to 70.25 a barrel after hitting 71 earlier in the session its highest intraday price since March 8.
U.S. West Texas Intermediate crude for July was up 1.40, or 2.1, to 67.72.
Tracking service GasBuddy said Sundays U.S. gasoline demand, coinciding with the Memorial Day weekend, jumped 9.6 above the average of the previous four Sundays. That was the highest Sunday demand since the summer of 2019.
U.S. crude stockpiles were expected to fall by 2.1 million barrels last week, according to a preliminary Reuters poll.
Prices were also boosted by Chinese data showing that the countrys factory activity grew at its fastest pace this year in May.
The gains were capped, though, by expectations that more output will hit the market.
The Organization of the Petroleum Exporting Countries and its allies, collectively known as OPEC, also agreed to continue a slow easing of supply curbs in their meeting on Tuesday, an OPEC source said, as producers balance an expected demand recovery against a possible increase in Iranian output.
The deal with Iran is very much in flux about whether or not it will get done, which is making the market tense, said John Kilduff, partner at Again Capital LLC in New…