Oil hovered below a three-year high near $70 a barrel on Monday on signs that production cuts by OPEC and Russia are tightening supplies, but analysts warned of “red flags” due to surging U.S. production.
International benchmark Brent crude futures LCOc1 were trading 12 cents lower at $69.75 by 1330 GMT, having risen above $70 earlier in the session.
U.S. West Texas Intermediate (WTI) crude futures CLc1 were unchanged at $64.30 a barrel. Trading was relatively slow due to a national holiday in the United States.
A production-cutting pact between the Organization of the Petroleum Exporting Countries, Russia and other producers has given a strong tailwind to oil prices, with both benchmarks last week hitting levels not seen since December 2014.
Growing signs of a tightening market after a three-year rout have bolstered confidence among traders and analysts that prices can be sustained near current levels.
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