Futures on the NYMEX CL=F contract rose 3.7% over the past week, driven by tightening global supply and stronger-than-expected demand forecasts. The XLE index surged 5.2%, reflecting broad energy sector strength. Analysts point to OPEC+ production discipline and geopolitical risks as key supports for oil’s upward trajectory.
- CL=F futures rose 3.7% in one week, hitting $85.20 per barrel
- XLE ETF gained 5.2% on strong sector-wide momentum
- USO recorded $280 million in net inflows over five days
- IEA raised 2026 global oil demand growth forecast to 1.4 million bpd
- OPEC+ output cuts and Red Sea disruptions are tightening supply
- Backwardation in crude futures curve has widened, signaling tight physical market
Crude oil futures on the NYMEX, tracked by the CL=F contract, have climbed 3.7% in the past seven days, marking their strongest weekly gain since October 2024. This rally follows persistent supply limitations, with Brent crude trading above $88 per barrel and WTI surpassing $85, driven by sustained OPEC+ output cuts and unplanned outages in key producing regions. The energy sector’s broader momentum is evident in the SPDR S&P Oil & Gas Exploration & Production ETF (XLE), which rose 5.2% over the same period, outperforming the S&P 500. This reflects growing investor confidence in energy equities amid elevated oil prices and improving refining margins. The United States Oil Fund (USO), a popular ETF tracking crude futures, has seen net inflows of $280 million in the last five trading days, signaling increased institutional and retail interest. Geopolitical tensions in the Red Sea and disruptions to maritime shipping routes have further tightened global supply chains, contributing to a 2.1% month-over-month increase in global crude inventories drawdowns. Meanwhile, demand forecasts from the International Energy Agency (IEA) have been revised upward, projecting global oil demand growth of 1.4 million barrels per day for 2026, fueled by resilient industrial activity in Asia and recovering transport sectors in North America. The combination of constrained supply, rising demand, and elevated volatility has led to a narrowing of backwardation in the crude oil futures curve, indicating stronger near-term physical demand. This shift is reinforcing bullish sentiment among traders and portfolio managers, with open interest in CL=F futures increasing by 12% in the past two weeks.