2018.01.1501:36:00UTC+00Oil Prices Near December 2014 Highs on OPEC Output Cuts

Oil prices steadied just below the peak levels hit on December 2014 on Monday, propped up by the ongoing production cuts led by OPEC and other producers despite an increase in U.S. and Canadian drilling activity that are expected to drive up future production in North America.

Brent crude futures stood at $69.85 per barrel, falling 2 cents from their last settlement. U.S. WTI crude futures stood at $64.40 per barrel, down 10 cents from their previous close. Last week, both benchmarks hit levels not seen in over three years, with Brent and WTI reaching $70.05 and $64.77 per barrel, respectively.

ANZ bank said that oil prices have received support from data showing the continuous tightening of the market.

An OPEC-led production cut deal have provided a significant amount of support to the markets, as the initiative looks to prop up crude prices. The deal was implemented starting January last year and is set to continue through 2018. The agreement coincided with solid demand growth, driving up crude prices by over 13 percent since early December.

Other developments, such as political risk, have also given crude markets support. JPMorgan said in a note that while tighter fundamentals are the main driver of the recent rally in prices, geopolitical risk and forex moves along with speculative money in combination have provided impetus to the move.