Crude oil prices rose on Monday on forecasts of a supply deficit stemming from high summer fuel consumption and OPEC+ production cuts in the third quarter.
Brent crude oil futures rose 53 cents (0.6%) to $85.53 per barrel and West Texas Intermediate (WTI) was at $82.05 per barrel, up 51 cents (0.6%).
Both contracts rose around 6% in June with Brent hitting above $85 a barrel over the past two weeks after the Organization of the Petroleum Exporting Countries (OPEC) and its allies extended most of their oil output through 2025.
Market analysts predict a supply deficit in the third quarter for transportation demand and air conditioning during the summer will experience a reduction in fuel stocks.
Last Friday, the Energy Information Administration (EIA) reported that oil production and demand for key products rose to four-month highs during April.
However, expectations of an interest rate cut by the Federal Reserve (Fed) and rising geopolitical concerns in Europe as well as the Israel-Hezbollah conflict in Lebanon also kept prices below current levels.
WTI's recent rally may extend towards $85 a barrel if prices remain above the 200-day moving average of $79.52.
Investors are now watching the hurricane situation for oil and gas production in the Americas.
The Atlantic hurricane season kicked off with Hurricane Beryl on Sunday. The category 4 hurricane is expected to make its way to the Windard Caribbean Islands where it is expected to bring life-threatening disasters and flash floods to the important region.
