Oil's recovery rally extended into a sixth day on optimism that production cuts and improving demand are beginning to chip away at the supply glut caused by coronavirus lockdowns and the price war.

Futures in New York swung around $25 a barrel in Asian trading after surging 20% on Tuesday to close at the highest level in almost a month. Diamondback Energy Inc. and Parsley Energy Inc. became the latest U.S. drillers to cut production in the country’s biggest shale fields. That came after OPEC+ began implementing 9.7 million barrels per day of output curbs on May 1.

West Texas Intermediate for June delivery rose 1% to $24.81 a barrel on the New York Mercantile Exchange as of 8:25 a.m. in Singapore. The contract has more than doubled in price in a six-day rally that’s the longest since February 2019. WTI for June is now less than $2 cheaper than for July, suggesting concerns about over-supply have eased.

Brent for July settlement advanced 0.7% to $31.18 a barrel on the ICE Futures Europe exchange. It jumped 14% on Tuesday to close above $30 a barrel for the first time in three weeks and has surged 56% since the close on April 27.

Source: Bloomberg