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US crude prices rise 2.2%, settling at $47.07 for best winning streak since 2012

  • Oil prices rose for an eighth day on Monday, their longest rally in over five years after data pointed to moderating U.S. output.
  • Analysts said news of rising OPEC production could temper gains.
  • June OPEC production was up by 280,000 bpd at 32.72 million bpd, according to a Reuters survey.

Oil prices rose for an eighth day on Monday, marking its longest stretch of daily gains in more than five years after data pointed to moderating U.S. output.

U.S. West Texas Intermediate (WTI) crude futures ended Monday's session $1.03, or 2.2 percent, higher, at $47.07 per barrel. That marked a four-week closing high, adding to last week's 7 percent gain.

Brent crude futures climbed 92 cents, or 1.9 percent, to $49.69 per barrel by 2:35 p.m. ET (1835 GMT), after jumping 5.2 percent last week, its first weekly gain in six weeks. Brent traded at its highest intraday level in more than three weeks on Monday.

Crude posted its longest unbroken stretch of gains since February 2012.

"Its all about market sentiment," said Commerzbank senior oil analyst Carsten Fritsch. He cited a 100,000 barrel per day drop in U.S. production due to tropical storms and maintenance, as well as a decline in U.S. rig count.

"These... (temporary) factors outweigh the sharp increase in OPEC oil production in June... and the continued increase in Libyan and Nigerian output at least at the moment," he said.

Speculators in Brent crude futures and options raised their bets against a sustained price rise to the highest level on record in the latest week.

Drilling activity for new oil production in the United States fell for the first time since January, dropping by two rigs, while U.S. government data showed crude output fell in April for the first time this year.

"In our view there is still a significant shortfall in onshore output relative to prior market expectations," Standard Chartered wrote in a note on Monday, "We think the fall in prices has caused U.S. output growth to slow, and that revisions for May and June will confirm that supply is growing at a significantly more modest rate than the market has believed up to now."

The oil price remains down more than 13 percent this year, with strong global demand insufficient to absorb rising output from the United States, Nigeria, Libya, Brazil and the North Sea.

Despite the dip, the total U.S. rig count was more than double the 341 rigs the same week a year ago, energy services firm Baker Hughes said.

Oil markets remain oversupplied as output from the Organization of the Petroleum Exporting Countries hit a 2017 high. Analysts on Monday said news of rising OPEC production could temper gains.

June OPEC production was up by 280,000 bpd at 32.72 million bpd, according to a Reuters survey, despite the group's pledge to hold back output.

"To put that in context, that is nearly a quarter of the 1.2 million barrels (per day) OPEC agreed to cut," said Greg McKenna, chief market strategist at AxiTrader, adding the rise came from Nigeria and Libya, which are exempted from the cuts.

On Monday at an event in London Iraq's oil minister Jabar al-Luaibi said the country has the right to achieve oil output in line with its crude reserves.

— CNBC's Tom DiChristopher contributed to this story.