Oil set for longest rally in 17 months

Bloomberg

Oil headed for its longest stretch of daily gains in more than 17 months as the US Federal Reserve sought to ease investor concerns, China moved to sti-mulate its economy and Opec production cutbacks took effect.
Futures in New York climbed as much as 3.2 percent after a fifth consecutive increase, when they settled at the highest closing level in two weeks. Crude is rising with other risk assets after Fed Chairman Jerome Powell said the bank could pause interest-rate increases if the US economy weakens. Data last week showed Opec is following through on pledges to cut output.
Crude has recovered slightly this month after posting its first annual loss since 2015. While Goldman Sachs Group Inc cut its oil-price forecasts for 2019, citing a re-emerging glut and resilient American shale output, the bank said a 42 percent drop towards the end of last year was excessive. Volatility persists as the US and China try to negotiate an end to a trade war that risks hurting economic growth and Opec and its allies pursue supply curbs.
“It could be that prices reached a turning point at the end of last year,” said Giovanni Staunovo, an analyst at UBS Group AG in Zurich. “Now I expect price support as the production cuts agreed by Opec come into force, as oil demand remains healthy, and as we face a number of supply disruptions in the fragile Opec states.”
The market could be tighter in the first quarter than previously expected, he said.
Brent for March settlement advanced as much as 2.2 percent to $58.32 a barrel on the ICE Futures Europe Exchange in London. Futures surged 9.3 percent last week, the biggest jump since December 2016. The global benchmark crude traded at an $8.91 premium to WTI for the same month.