Investing.com - Oil prices extended strong overnight gains in North American trade on Tuesday, with Brent futures climbing above the $51-level for the first time in eight months as market players continued to monitor global supply disruptions.
On the ICE Futures Exchange in London, Brent oil for August delivery rose to an intraday high of $51.30 a barrel, the most since October 12. It last stood at $51.11 by 12:35GMT, or 8:35AM ET, up 56 cents, or 1.12%.
On Monday, London-traded Brent rallied 91 cents, or 1.83%, on reports of more attacks by militants to Nigeria oil operations.
Brent prices have been well-supported in recent weeks as unplanned supply disruptions in Africa eased concerns over a global glut. Brent futures prices are up by roughly 85% since briefly dropping below $30 a barrel in mid-February.
Elsewhere, crude oil for July delivery on the New York Mercantile Exchange tacked on 49 cents, or 0.99%, to trade at $50.18 a barrel after hitting a daily peak of $50.37, a level not seen since October 9.
New York-traded oil jumped $1.07, or 2.2%, on Monday, after industry group Genscape reported a drawdown of 1.08 million barrels at the Cushing, Oklahoma delivery point for WTI futures during the week to June 3.
Market players now looked ahead to fresh weekly information on U.S. stockpiles of crude and refined products. The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles fell by 3.5 million barrels in the week ended June 3.
U.S. crude futures are up nearly 80% since falling to 13-year lows at $26.05 on February 11 as a decline in U.S. shale production boosted sentiment. However, with prices now at levels that make drilling economical for some firms, the rig count might start rising soon and the decline in U.S. production may slow.
Oilfield services provider Baker Hughes said Friday that the number of rigs drilling for oil in the U.S. increased by nine last week to 325, ending three straight months of weekly declines.
The renewed gain in U.S. drilling activity fueled speculation that domestic production could be on the verge of rebounding in the weeks ahead, underlining worries over a supply glut.
Meanwhile, Brent's premium to the WTI crude contract stood at 93 cents a barrel, compared to a gap of 86 cents by close of trade on Monday.