Oil prices rise to highest in a year on U.S. growth optimism, crude supply restraint

By Sonali Paul
MELBOURNE, Feb 5 (Reuters) - Oil prices climbed on Friday to
their highest levels in a year, extending a run of strong gains
this week, boosted by the continued commitment of producers to
hold back crude supply and positive signs of economic growth in
the United States.
U.S. West Texas Intermediate (WTI) crude CLc1 futures
jumped 51 cents, or 0.9%, to $56.73 a barrel by 0210 GMT, after
touching a high of $56.75, the most since Jan. 22 last year. The
benchmark contract is on track for a weekly gain of nearly 9%,
which would be its biggest weekly gain since October
Brent crude LCOc1 futures climbed 45 cents, or 0.8%, to
$59.28 a barrel, after hitting a high of $59.32, its highest
since Feb. 20 last year. Brent is on track to rise 6% this week.
Markets were encouraged by stronger-than-expected orders for
U.S. goods in December, pointing to strength in manufacturing,
and hopes for swift approval by lawmakers of President Joe
Biden's proposed $1.9 trillion coronavirus aid plan.
"OPEC+ discipline has been a real positive," said Michael
McCarthy, chief market strategist at CMC Markets, referring to
the Organization of the Petroleum Exporting Countries and allies
led by Russia, together called OPEC+. The alliance this week
reaffirmed its support for deep supply cuts which have helped to
bring down swollen global crude stockpiles. "And then when we have signs of better economic growth, then
it's up and away (for prices)," said McCarthy.
Chinese demand for crude oil is also helping support the
market, as shown by industry tracking two tankers of North Sea
crude oil heading to China for March 22 and March 24, said Axi
global market strategis Stephen Innes.
"When demand drives commodity prices, it has a more bullish
impact and leaves a more lasting reflection on price action,"
Innes said in a note.