Light, sweet crude for February delivery rose 58 cents, or 1%, to $60.42 a barrel on the New York Mercantile Exchange, the highest settle value since June 2015.
Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Supportive equities, with DOW hitting another record high also kept oil elevated.
The benchmark USA contract, West Texas Intermediate for February delivery, climbed 58 cents to finish at $60.42 a barrel.
In November, the Organization of the Petroleum Exporting Countries, along with a group of other major producers outside the cartel including Russian Federation, agreed to extend a deal to cap production through 2018. China also reported a 3% decline in inventories last month, sending stockpiles to their lowest level in seven years. The largest destination for USA distillate exports in 2016 was Mexico, averaging 182,000 b/d, followed by Brazil (125,000 b/d) and the Netherlands (108,000 b/d).
United States exports of distillate also experienced slower year-over-year growth compared with recent years.
"The market continues to find support from expectations that we're going to see the cut extended and from robust demand", said Gene McGillian, director of market research at Tradition Energy in Stamford. "We kind of need the supply", Mr. Cooper said.
The optimism wasn't so widespread earlier this year. It was at a premium of $6.45 to March WTI.
"It really wasn't until the fourth quarter that we saw a resounding faith in the recovery", Stratas Advisors' Petersen said.
OPEC and Russia's efforts to curb oil output, combined with forecasts for strong global demand growth, are expected to keep crude prices close to $60 a barrel in 2018, a Reuters poll of analysts showed on Thursday. It ranks first in oil futures trade.
Hedge funds boosted their Brent net-long position - the difference between bets on a rally and wagers on a decline - to an all-time high on Dec 12 and have kept it near that level.
For now, shale drillers are showing restraint, with the number of working rigs unchanged for the second week in a row, according to Baker Hughes data released on Friday.
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