Investing.com - Oil prices firmed above the $45-level in European trade on Monday, as huge wildfires in rural Canada continue to hit supply from the country's vast oil sands reserves.
At least 645,000 barrels a day of oil-sands production have been sidelined, based on public announcements, but the true figure may be closer to one million barrels a day, or nearly half of Canada’s total 2.5 million barrels a day in oil-sands output.
Meanwhile, markets mulled the appointment of Khalid al-Falih as Saudi Arabia's new oil minister. The chairman of the state-owned oil company Saudi Aramco replaces 20-year veteran Ali al-Naimi.
The change is unlikely to mean a shift in Saudi oil policy. Falih said on Sunday that the world's largest crude exporter was committed to meeting demand and would maintain its stable petroleum policies.
Crude oil for June delivery on the New York Mercantile Exchange tacked on 53 cents, or 1.19%, to trade at $45.19 a barrel by 07:55GMT, or 03:55AM ET, after rising by as much as 2.1% to a daily peak of $45.94.
On Friday, Nymex prices inched up 34 cents, or 0.77%. Despite Friday’s gains, oil prices ended the week lower as concerns over a global supply glut lingered. New York-traded oil futures slumped $1.24, or 2.74%, last week, snapping a four-week win streak.
Nymex oil prices are still up nearly 55% since falling to 13-year lows at $26.05 on February 11, as a decline in U.S. shale production boosted sentiment. Oilfield services provider Baker Hughes said Friday the number of rigs drilling for oil in the U.S. fell by four last week to 328, a fresh six-year low. At this time last year, drillers were operating 668 oil rigs.
However, analysts warned that market conditions remained weak due to an ongoing glut. U.S. crude oil stockpiles rose by 2.8 million barrels last week to a record-high of 543.4 million barrels, according to the U.S. Energy Information Administration.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for July delivery rose to a session high of $46.48 a barrel, before giving back some gains to trade at $45.70, up 33 cents, or 0.73%.
London-traded Brent futures fell $2.00, or 5.73%, last week, the first weekly loss in five weeks.
Brent futures prices are up by roughly 60% since briefly dropping below $30 a barrel in mid-February, despite the collapse of talks at a Doha summit in April aimed at achieving a production freeze among OPEC and Non-OPEC producers. OPEC meets on June 2 in Vienna and may discuss the freeze initiative again.
Meanwhile, Brent's premium to the WTI crude contract stood at 51 cents a barrel, compared to a gap of 71 cents by close of trade on Friday.
In the week ahead, oil traders will be focusing on U.S. stockpile data on Tuesday and Wednesday for fresh supply-and-demand signals.
Market participants will also keep an eye out for monthly reports from the International Energy Agency and the Organization of Petroleum Exporting Counties to gauge global supply and demand levels.