Oil prices rose 5 percent on Monday after the world’s oil consumer body said it expected U.S. shale production to fall this year and next, potentially reducing the glut in supplies that has driven prices to their lowest level in over a decade.
A bounce in global stock markets and the after-effect of a fall in the U.S. oil rig count last week also supported prices.
International benchmark Brent crude futures LCOc1 were up $1.61, or 4.9 percent, at $34.62 a barrel at 1326 GMT, while U.S. crude futures CLc1 broke through the $30-a-barrel mark, trading up $1.44, also 4.9 percent, at $31.08 a barrel.
The International Energy Agency (IEA) said in its medium-term outlook on Monday that U.S. shale oil production was expected to fall by 600,000 barrels per day (bpd) this year and another 200,000 bpd in 2017.
This fed into data released late last week that showed U.S. drilling rig numbers had fallen to the lowest level since December 2009.
Global stock markets also bounced on Monday, extending last week’s gains and bringing a more upbeat tone to commodity markets.