Oil Futures Rise 8% in 3rd Gain in a Row – New York Times

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Oil futures soared on Monday for a third consecutive day, rising more than 8 percent, as a downward revision of United States crude production data and the readiness of the Organization of the Petroleum Exporting Countries to talk with other producers helped extend the biggest price surge in 25 years.

United States crude oil prices have skyrocketed more than $ 10 a barrel in three days, erasing the month's declines as several relatively small supply disruptions and output risks prompted bearish traders to take profits on short positions, which were near record highs a week ago.

On Monday, prices fell initially but reversed at midmorning to accelerate into the close, extending gains beyond the 20 percent mark that often signals a bull market. Still, few were prepared to call an end to the slump.

"Sharp gains over the past three trading sessions were driven by a combination of short covering and chart readers again looking to call a bottom falsely," Citigroup said in a report, adding that prices might test new lows this year.

Brent October futures rose $ 4.10, or 8.2 percent, to settle at $ 54.15 a barrel. Volumes were muted by a British holiday.

United States crude gained $ 3.98, or 8.8 percent, to settle at $ 49.20 a barrel, taking three-day gains to 27.5 percent, the most over three days since August 1990. In dollar terms, it is the biggest three-day gain since February 2011.

While some analysts had been warning of a price rebound after a one-third slump since late June, many expressed shock at the whiplash of the last few days.

On Monday, some cited a commentary in the latest OPEC Bulletin suggesting the group may be increasingly willing to talk to other producers about curbing output as a factor, though it was broadly in line with previous comments. Nothing this summer has indicated that core Gulf OPEC members are pushing for more talks.

The rally was also fueled by revised figures showing that American production in the first half of the year was lower than initially reported. Still, the figures were in line with the narrative of an industry in decline.

The Energy Information Administration said its new survey-based output figures showed the United States pumped slightly less than 9.3 million barrels per day in June, down 100,000 from the revised figure for May. The June number was also nearly 250,000 barrels per day below what the agency estimated a few weeks ago.