Crude oil prices surged on Monday on expectations that 'OPEC+', the cartel of Organisation of the Petroleum Exporting Countries (OPEC) and its allied oil producing nations would limit the oil output at the current levels.
Brent crude crossed the $53 per barrel mark and touched a multi-month high of $53.17 a barrel. It is the highest level since March 2020. Currently, the March contract of Brent on the Intercontinental Exchange (ICE) was trading at $53.04 per barrel, higher by 2.39 per cent from its previous close.
Similarly, the February contract of WTI crude on NYMEX was trading at $49.53 per barrel, higher by 2.08 per cent from its previous close.
Market anticipates that in February the production levels of crude would remain at the same level as last year and with elevated demand, prices could remain firm.
On Sunday, Mohammad Barkindo, Secretary General of OPEC, said that while crude demand is expected to rise by 5.9 million barrels per day (bpd) to 95.9 million bpd this year, the cartel sees plenty of downside demand risks in the first half of 2021.
Tapan Patel, Senior Analyst (Commodities), HDFC securities said: "Crude oil prices have held a steady range near the resistance levels of $50. Crude oil prices are supported by vaccine rollout optimism and expectations that OPEC plus nations may keep output quota unchanged when they meet today."