Oil gains before expected reduction in U.S. stockpiles

March futures advanced 0.8% as a survey showed stockpiles probably shrank for a 10th week, which would mark the longest run of reductions in weekly data since 1982. Inventory figures will be released by the government Wednesday, with a separate estimate from the American Petroleum Institute Tuesday.

Oil is extending a two-year advance after OPEC and its allies including Russia reiterated their commitment to curb supply to drain a global glut. While Goldman Sachs Group Inc. and the International Energy Agency warn of a looming surge in U.S. shale output, that producer deal and a “supportive” economic outlook from the International Monetary Fund could underpin further price gains, said Tamas Varga, an analyst at PVM Oil Associates Ltd. in London.

“If we break $70 on Brent then we’re probably going to go higher,” he said. “We are waiting for the inventory data.”

West Texas Intermediate for March rose as much as 71 cents to $64.28/bbl on the New York Mercantile Exchange, and was at $64.09 as of 9:13 a.m. New York time. Total volume traded was about 11% below the 100-day average. The February contract expired Monday after adding 12 cents.

Brent for March settlement climbed 61 cents to $69.64/bbl on the London-based ICE Futures Europe exchange after gaining 0.6% on Monday. The global benchmark crude traded at a premium of $5.54 to WTI.

U.S. crude inventories probably dropped by 2.25 MMbbl last week, according to a Bloomberg survey of analysts. Stockpiles fell to 412.7 MMbbl in the week ended Jan. 12, the lowest since February 2015, data from the Energy Information Administration showed last week. Oil production rebounded to 9.75 MMbpd, near a record.

“It’s a question of how fast we are continuing toward the five-year average,” said Michael Poulsen, an analyst at Global Risk Management. “The market will be looking to see if there are any major draws on crude.”