Oil prices have increased today supported by producer supply cuts and over expectations that vaccine rollouts will help in the recovery of fuel demand.

On 9 February, the American Petroleum Institute (API) said that crude stocks dropped by 3.5 million barrels, against expectations for a 985,000-barrel build. The Energy Information Administration’s stocks report is due today.

Brent crude increased by $0.28 to $61.37 while US crude grew $0.21 to reach $58.57, reported Reuters.

Stephen Brennock of broker PVM was quoted by the news agency as saying: “One can only wonder whether there’s further to go in this week’s rally. However, as things stand, oil has yet to lose its shine.”

For nine sessions in a row, the Brent price has increased and according to some analysts, a dip may be due.

Avatrade chief market analyst Naeem Aslam said: “There is no doubt that oil prices have gone too far and too fast, which means a retracement is certainly due.”

Since November, crude prices have increased as several countries began Covid-19 vaccination drives, large stimulus packages were announced to boost economic activity and top crude producers restricted supply.

World’s top exporter Saudi Arabia reduced supply in February and March, in addition to the cuts agreed by the Organization of the Petroleum Exporting Countries (OPEC) and allies.

According to some analysts, there could be a deficit in supply this year, given that with more people getting vaccinated, they are likely to start travelling and working from offices, which would in turn increase demand.