Brent crude oil hit a new 2017 high on Monday, continuing a rally fueled by improving demand and expectations that producers will extend output cuts.
U.S. West Texas Intermediate crude surged more $1.56, or 3.1 percent, to end Monday's session at $52.22 a barrel, the highest closing level since April. WTI hit a session peak of $52.28, about $3 below its 2017 intraday high.
International benchmark Brent rose $2.01, or 3.5 percent, to $58.87 by 2:09 p.m. ET, having touched the highest level since July, 2015.
U.S. WTI crude futures, year to date, source: Factset
Trader positioning shows the market believes there's more room for U.S. crude prices to run up.
Hedge funds raised their bullish bets on U.S. crude futures to the highest level in four weeks, the U.S. Commodity Futures Trading Commission reported on Friday. Wagers that oil prices will fall declined for a third straight week, according to the data covering trades through Sept. 19.
The positioning suggests that the prevailing bear case in the market is unraveling, said Tamar Essner, director of energy and utilities at Nasdaq Corporate Solutions. Traders were convinced that U.S. drillers would flood the market with oil whenever prices rose above $50 a barrel.
But American producers signaled a greater focus on fiscal discipline during second quarter earnings reports.