Oil up sharply, posts first monthly gain since June

Fri Feb 27, 2015 4:08pm EST
 
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By Robert Gibbons

NEW YORK (Reuters) - Crude oil rose sharply on Friday as Brent and U.S. futures posted their first monthly gains since June, supported by an improving demand outlook and supply outages.

On its way to contract expiration, March New York ultra-low sulfur diesel (ULSD) gained more than 7 percent in volatile trading, and the 36 percent February increase was the biggest percentage monthly rise in 15 years.

Brent crude LCOc1 rose $2.53 to $62.58 a barrel. February's 18 percent gain was the biggest monthly percentage rise since May 2009.

U.S. crude CLc1 rose $1.59 to settle at $49.76, managing a 3.1 percent February gain.

Both Brent and U.S. futures briefly pared gains after Baker Hughes Inc (BHI.N: Quote) data showed its U.S. oil drilling rig count fell only 33 to 986 this week.

U.S. crude gains have been curbed by rising crude oil inventories in the United States, up 8.4 million barrels last week, according to government data. [EIA/S]

Money managers cut their net long U.S. crude futures and options positions in the week to Feb. 24, the U.S. Commodity Futures Trading Commission (CFTC) said Friday.

Both contracts have been supported by signs that lower prices are starting to reduce investment in non-OPEC production, even as the U.S. rig count slide slows.   Continued...

 
A pumpjack brings oil to the surface  in the Monterey Shale, California, April 29, 2013.  REUTERS/Lucy Nicholson