Oil Near an 11-Month Peak, Thanks to a Saudi Pledge to Cut Production

Oil prices held near an 11-month high on Friday (January 8th) and is on track for strong weekly gains as Saudi Arabia’s pledge to cut production continued to support market sentiment.

Brent crude rose 13 cents, or 0.2%, to $ 54.51 a barrel. The global benchmark touched $54.90 on Thursday, the highest since February.

And US West Texas Intermediate crude gained 14 cents, or 0.3%, to $50.97.

Crude closed up 0.4% on Thursday after it also reached its highest level since February at $51.28.

The two benchmarks are on track for gains of about 5% this week.

And earlier this week, Saudi Arabia, the world’s largest oil exporter, said it would cut production by an additional 1 million barrels per day in February and March.

On Thursday, seven shipments of North Sea crude were bought and sold on the trade platform operated by Platts, a record amount that trade sources say may indicate lower supplies after the sudden cut.

UBS raised its forecast for Brent crude to $60 a barrel by the middle of the year, following the unilateral reduction of Saudi Arabia and expectations of a strong recovery in demand in the second quarter with a recovery in travel due to the distribution of anti-Coronavirus vaccines.