UPDATE 7-Oil rises after data shows slump in U.S. output amid Texas freeze

* Brent, WTI hit fresh 13-month high
* U.S. crude output off 10%, refining runs down to 2008 low
-EIA
* Houston ship channel slowly returning to normal traffic
* OPEC+ to weigh modest oil output boost at meeting -
sources

(Updates with settlement prices, OPEC+ easing of curbs)
By Stephanie Kelly
NEW YORK, Feb 24 (Reuters) - Oil prices climbed on Wednesday
to fresh 13-month highs after U.S. government data showed a drop
in crude output after a deep freeze disrupted production last
week.
U.S. crude oil production dropped last week by more than
10%, or 1 million barrels per day, during the rare winter storm
in Texas, equaling the largest weekly fall ever, the Energy
Information Administration said. Refinery crude inputs dropped
to the lowest since September 2008 as the freeze knocked out
power to millions. EIA/S
"If you're getting that kind of drop in one week of EIA
production, you're likely to get more after that," said Phil
Flynn, senior analyst at Price Futures in Chicago.
"There is some concern that this will be a long-term
permanent production drop."
Traffic at the Houston ship channel was slowly coming back
to normal but terminals were still facing several issues. After
nearly a quarter of national refining capacity was idled by the
freeze, refineries have also started to come back online this
week.
Brent crude LCOc1 futures rose $1.67, or 2.6%, to settle
at $67.04 a barrel. The global benchmark hit a session high of
$67.30 a barrel, its loftiest since Jan. 8, 2020.
U.S. West Texas Intermediate (WTI) crude CLc1 futures
ended $1.55, or 2.5%, higher at $63.22 a barrel, after touching
$63.37, also their highest since Jan. 8, 2020.
The rally continued oil's steady march to levels not seen
since prior to the coronavirus pandemic as vaccine distribution
increases and on forecasts for renewed demand.
Oil prices have rallied about 30% since the start of the
year, boosted as well by ongoing supply cuts by the Organization
of the Petroleum Exporting Countries and its allies.
Some investors have piled into $100 U.S. oil options
contracts as appetite for commodities as a hedge against
inflationary pressure is rising, industry sources said.
Volumes in bullish call options and call option spreads for
U.S. crude for delivery in December 2021 and December 2022 have
surged over the past week, dealers said. About 50,000 options
traded in December 2022 on the call spread between oil at $99
and $100 a barrel as well as those between $98-$100 and $90-$100
oil, dealers said.
OPEC+ oil producers will discuss a modest easing of oil
supply curbs from April given a recovery in prices, OPEC+
sources said, although some suggest holding steady for now given
the risk of new setbacks in the battle against the pandemic.