Oil prices gained 1% on Friday after OPEC+ producers assured their commitment to the agreed production cuts and two major oil traders said that demand was recovering.
Brent crude futures climbed 0.8%, or 35 cents, at $41.86 per barrel. U.S. West Texas Intermediate crude futures were up 1%, or 38 cents, at $39.22 per barrel. Both benchmarks are headed for weekly gains of 8%.
Iraq and Kazakhstan promised to compensate for overproduction by committing to the agreed cuts. This came after the meeting with OPEC’s panel monitoring compliance.
If both producers compensated for their overproduction for the next three months, it could take extra barrels out of the oil market, even if OPEC no longer extends their record cut beyond July.
Meanwhile, investors dismissed another increase in U.S. crude inventories. Crude stocks rose by 1.2 million barrels to 539.3 million barrels last week. This was opposite analysts’ expectations of a 152,000-barrel decline.