LONDON: Oil prices jumped by about 1% on Tuesday, boosted by a tighter supply outlook and OPEC optimism over the resilience of major economies in the face of rising interest rates.
November Brent crude futures gained $1.16, or 1.3%, to $91.80 a barrel by 1335 GMT while U.S. West Texas Intermediate crude futures for October firmed by $1.35, or 1.6%, to $88.64.
Brent breached $90 a barrel last week for the first time in 10 months after Saudi Arabia and Russia announced they would extend a combined 1.3 million barrels per day (bpd) of voluntary supply cuts until the end of the year.
There is little doubt that the oil industry sees increasing likelihood of oil price inflation, said PVM Oil analyst John Evans, citing supply and demand fundamentals.
The Organization of the Petroleum Exporting Countries (OPEC) on Tuesday stuck to an upbeat demand growth forecast for this year and next.
Global oil demand is projected to rise by 2.25 million bpd in 2024, compared with growth of 2.44 million bpd in 2023, OPEC said in its monthly report. Both forecasts were unchanged from last month.
The International Energy Agency releases its forecasts on Wednesday.
In Libya, a deadly storm led the OPEC member to shut four of its eastern oil export terminals on Saturday.
Meanwhile, August U.S. consumer price index data due on Wednesday is expected to provide some indication on the outlook for U.S. interest rates. The Federal Reserve is widely expected to leave rates unchanged at a policy meeting next week, though views are split over whether it will raise rates in November.
The European Central Bank will announce its interest rate decision on Thursday.
The European Commission on Monday forecast that the euro zone will grow more slowly than previously expected in 2023 and 2024.
Investors were also awaiting industry data on U.S. crude stocks, due at 2030 GMT on Tuesday. Crude inventories were expected to have fallen by about 2 million barrels in the week to Sept. 8, a preliminary Reuters poll showed on Monday.