Investing.com - Crude oil futures rose to the highest levels of the session on Monday, after the Organization of the Petroleum Exporting Countries cut forecasts for global oil-supply growth in 2015 as drillers in the U.S. pull back on new production in response to low prices.
In its monthly report released earlier in the day, OPEC lowered its 2015 estimate for non-OPEC supply growth by 420,000 barrels a day, led by a decline of 170,000 barrel a day in the U.S.
“The main factors for the lower growth prediction in 2015 are price expectations, a declining number of active rigs in North America, a decrease in drilling permits in the U.S. and a reduction in the 2015 spending plans of international oil companies,” OPEC said in the report.
OPEC also raised its forecast for demand for its own oil to 29.2 million barrels a day in 2015, up 400,000 barrels from a previous estimate.
On the New York Mercantile Exchange, crude oil for delivery in March rose by as much as 2.98%, or $1.59, to hit a session high of $53.28 a barrel, before trading at $52.55 during U.S. morning hours, up 85 cents, or 1.65%.
On Friday, New York-traded oil futures surged $1.21, or 2.4%, to end at $51.69 a barrel after industry research group Baker Hughes said that the number of rigs drilling for oil in the U.S. fell by another 87 in the past week to 1,136, the lowest since December 2011.
The number of oil rigs has declined in 14 of the last 17 weeks since hitting an all-time high of 1,609 in mid-October.
West Texas Intermediate oil futures are up nearly 18% over the past two weeks, but prices are still down almost 52% from a recent peak of $107.50 hit in June.
New York-traded oil futures climbed $4.10, or 7.15%, last week, the second straight weekly gain and the biggest advance since February 2011, amid indications U.S. producers may be pulling back on new production in response to low prices.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for April delivery tacked on 52 cents, or 0.89%, to trade at $59.20 a barrel, after rising by as much as $1.22, or 2.03%, to touch a daily high of $59.90.
London-traded Brent jumped $1.17, or 2.03%, on Friday to settle at $58.68.
The April Brent contract rallied $6.00, or 9.08%, last week, also the second consecutive weekly advance and the biggest increase since 2011, as some investors bet that a bottom had been reached after a seven-month long rout.
London-traded Brent prices sky-rocketed 17% over the past two weeks, the largest two-week gain since 1998. However, prices are still down approximately 50% since June, when futures climbed near $116.
Oil prices have fallen sharply in recent months as OPEC resisted calls to cut output, while the U.S. pumped at the fastest pace in more than three decades, creating a glut in global supplies.