West Texas Intermediate, a measure of US oil prices, hit $US50 a barrel for the first time since July on Thursday.
WTI Oil is currently trading at $US50.30, up 2.01% from the close on Wednesday.
OPEC recently increased its projected demand for Europe and China while IEA increased projections for oil consumption globally, according to Jon Rigby, an analyst at UBS.
“The IEA and OPEC both upgraded 2017 demand growth forecasts last month and this month’s round of updates saw the same again: the two agencies increased 2017 growth by 90,000 barrels a day and 50,000 barrels a day respectively to +1.60 million barrels per day and +1.42 million barrels per day,” Rigby wrote.
Oil refineries in the US are coming back online and increasing their demand for crude after several Hurricanes rampaged through the southern states and delayed refinery operations. Rigby said only the IEA made reductions to its projects due to the hurricanes, though the reductions were relatively small. OPEC and IEA think increased production in both Canada and Kazakhstan will offset most of the production losses in the US.
OPEC members have publicly mulled over extending production cuts implemented earlier this year, which would further restrict the supply of oil. Statements made by ministers in Kuwait, Qatar and Venezuela have suggested that the production cuts would be extended, according to Rigby.
Brent oil is also trading higher, gaining 1.02% and currently trading for $US55.66 per barrel.