Oil prices climbed back to their pre-pandemic levels on Monday, after hitting an all-time low last year, surging to $60 (£44) a barrel.
Prices have been boosted thanks to rising demand across the world, particularly in Asia. Experts say that a weaker dollar is also providing a boost to commodities.
Brent crude futures (BZ=F) have soared around 60% since November while West Texas Intermediate (WTI), the US benchmark, jumped above $55 a barrel last week for the first time in a year.
The coronavirus pandemic saw oil consumption plummet in 2020. Oil demand in China collapsed by 20% in February after the country locked down for the coronavirus pandemic.
However, last week, the Organisation of Petroleum Exporting Countries and their allies (OPEC+) announced “high compliance” among member states with agreements to limit supply to force up prices.
An OPEC statement said countries had held down production by a total of 2.1 billion barrels since April 2020 when the market suffered an historic collapse and futures prices even briefly turned negative.
“The committee welcomed the positive performance of participating countries,” it said, adding, “Participants pledged to achieve full conformity and make up for previous compensation short-falls, and stressed the importance of accelerating market rebalancing without delay.”
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