UPDATE 8-Oil prices surge for seventh straight day of gains

* Crude benchmarks touch 13-month highs
* U.S. 2021 crude output to fall more than previously
forecast-EIA
* U.S. crude stocks seen up 1 mln bbls last week -Reuters
poll
* Coming up: API oil inventory data at 4:30 p.m. ET/2130 GMT

(New throughout, updates prices, market activity and comments)
By Laura Sanicola
NEW YORK, Feb 9 (Reuters) - Oil prices rose on Tuesday for
their seventh straight session of gains, touching 13-month highs
as investors kept betting that fuel demand will rise while OPEC
and allied producers keep a lid on supply.
Brent LCOc1 settled up 53 cents, or 0.9%, to $61.06 a
barrel. U.S. West Texas Intermediate crude (WTI) CLc1 for
March was at $58.36 a barrel, up 39 cents or 0.7%.
The session peaks for both benchmarks were the highest since
January 2020.
"With Brent over $60, it's been great psychologically ...
and everyone is feeling bullish about stronger demand and global
inventories in further decline," said John Kilduff, partner at
Again Capital LLC in New York.
The markets have rallied since November as COVID-19 vaccines
are being distributed worldwide, and as governments and central
banks deploy huge stimulus packages to boost economic activity.
Top exporter Saudi Arabia is curbing supply in February and
March, on top of cuts by fellow producers in the Organization of
the Petroleum Exporting Countries and their allies, prompting
forecasts of a supply deficit this year. "The Saudis' intent to eliminate a global supply surplus
appears to be on track and capable of boosting crude prices
further," said Jim Ritterbusch, president of Ritterbusch and
Associates in Galena, Illinois.
Benchmark crude also drew support from the dollar's .DXY
fall to a one-week low, making greenback-denominated commodities
more attractive to holders of other currencies. USD/1
U.S. crude inventories have fallen to their lowest since
March, before the pandemic crushed the oil markets. Weekly U.S.
oil inventory data is due from industry group the American
Petroleum Institute at 4:30 p.m. EST (2130 GMT), followed by
government data on Wednesday. API/S
The U.S. government on Tuesday lowered its outlook for crude
oil production in 2021 to 11.02 million barrels per day from
11.1 million bpd previously forecast.