Investing.com - U.S. crude hit fresh 2019 highs on Tuesday on a mixture of renewed optimism about the economic outlook and the ongoing effects of falling output from OPEC countries.
New York-traded West Texas Intermediate crude futures gained 5 cents, or 0.5%, at $61.87 a barrel by 7:58 AM ET (11:58 GMT). It had topped the $62-mark earlier on Tuesday for the first time since last November.
Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., slipped 4 cents, or 0.1%, to $68.97, pulling back from an intraday high of $69.50.
Better-than-expected readings of manufacturing activity in the U.S. and China released this week eased concerns that a slowing global economy might require less oil.
A Reuters survey released Monday showed that OPEC's crude output fell nearly 300,000 barrels a day to a four-year low in March. Saudi Arabia led the charge by cutting more production than promised, while power outages in Venezuela restricted the loading of export shipments.
Markets took Tuesday’s news that Russia fell short of its oil-output cut target for March in their stride. Russian Energy Minister Alexander Novak had previously said April would be the first month that Moscow achieved full compliance with the output deal. Russia secured an effective exemption on cuts through the winter, a time when field maintenance poses particularly big challenges.
At the same time, there are signs that the explosive growth in U.S. output over recent months may be flattening out. Investing.com senior commodity analyst Barani Krishnan added ongoing declines in U.S. drilling activity to the list of bullish factors, calling it “a perfect storm for traders and funds caught on the short side of the market."
Later on Tuesday, the American Petroleum Institute is due to release its weekly report on crude inventories for the week ended March 29 at 4:30PM ET (20:30 GMT).
That’s ahead of Wednesday’s release of official government data from the Energy Information Administration, amid expectations for a draw of 1.2 million barrels.
In other energy trading, gasoline futures gained 0.3% to $1.9044 a gallon by 8:01 AM ET (12:01 GMT), while heating oil advanced 0.3% to $1.9937 a gallon.
Lastly, natural gas futures traded down 0.1% to $2.705 per million British thermal unit.