Oil rises to approximately $56 on rising refinery demand, falling U.S. rig count

Oil markets were firm on Monday and remained near multi-month highs reached late last week as the number of U.S. rigs drilling for new production fell and refineries continued to start up after getting knocked out by Hurricane Harvey.

U.S. West Texas Intermediate (WTI) crude futures were at 50.0 dollars per barrel at 0547 GMT, and close to the more than three-month high of 50.50 dollars reached last Thursday.

Brent crude futures, benchmark for oil prices outside the United States, were at 55.71 dollars a barrel, up 9 cents and not far from the almost five-month high of 55.99 dollars touched on Thursday. Brent was 56 dollars on Wednesday.

“Demand forecasts from OPEC and IEA continued to improve sentiment in the market. Refineries are also reporting a much better recovery from the recent hurricanes,” ANZ bank said on Monday.

Royal Dutch Shell’s Deer Park refinery in Texas was among the latest, beginning its restart on Sunday. The plant can process 325,700 barrels per day.

The refinery restarts are occurring “as signs emerge of stalling growth in the U.S. shale industry. The number of rigs drilling for oil in the U.S. fell sharply last week,” ANZ said.

U.S. energy firms cut seven oil rigs in the week to Sept. 15, bringing the total count down to 749, the fewest since June, energy services company Baker Hughes said on Friday.