Oil set for longest run of gains in 5 years before OPEC meets

Oil is set to cap the longest run of monthly gains in five years as output disruptions from Nigeria to Canada curb supply before OPEC meets Thursday to discuss production policy.

Futures gained as much as 1.6 percent in New York and are set for a fourth monthly advance. Militant attacks have cut Nigerian supply to the lowest level in more than two decades. Producers are starting to resume operations in Canada as wildfires that reduced output by more than a 1 million barrels a day eased. Libya’s Petroleum Facilities Guard captured towns near the oil ports of Es Sider and Ras Lanuf after clashes with Islamic State militants.

“The attacks in Nigeria are probably the biggest reason for strength now,” said Bob Yawger, director of the futures division at Mizuho Securities USA in New York. “The Delta Avengers were back at it this weekend adding to the problems that have cut production by nearly 1 million barrels. This comes as production is dropping elsewhere.”

Oil has surged more than 85 percent since touching a 12-year low in February on signs the global surplus is easing amid declining output. The Organization of Petroleum Exporting Countries is unlikely to reach an agreement limiting production this week as the group sticks with Saudi Arabia’s strategy of squeezing out rivals, according to analysts surveyed by Bloomberg.

West Texas Intermediate for July delivery rose 51 cents, or 1 percent, to $49.84 a barrel at 10:15 a.m. on the New York Mercantile Exchange. There was no settlement Monday because of the U.S. Memorial Day holiday. Trades will be bookedTuesday for settlement purposes. Prices are up about 8.5 percent in May for the longest run of monthly gains since April 2011.

Brent for July settlement, which expires Tuesday, rose 16 cents to $49.92 a barrel on the London-based ICE Futures Europe exchange. Prices are set for a fourth monthly increase, also the longest streak since 2011. The global benchmark traded at an 8-cent premium to WTI. The more-active August contract advanced 21 cents to $50.57.

The Niger Delta Avengers has claimed responsibility for attacks on facilities belonging to companies including Chevron Corp., Royal Dutch Shell Plc and Agip Oil Co., causing Nigerian output to tumble. A message on the Twitter handle @NDAvengers said militants attacked the Nembe 1, 2 and 3 pipelines of the Brass-to-Bonny Truck Line Saturday. Although the Twitter handle is linked to the group’s website, the post’s authenticity couldn’t be immediately confirmed by Bloomberg.

For a column on what to expect from the OPEC meeting, click here.

Libyan forces took control of the towns of Bin Jawad and Nofaliyeh after clashes with Islamic State militants, PFG spokesman Ali al-Hasy said by phone. The nation is the smallest OPEC producer, pumping about 310,000 barrels a day.

Oil-market news:

Prices may climb to $60 a barrel or more this summer, United Arab Emirates Economy Minister Sultan Bin Saeed Al Mansoori said at a conference.

Delphi Energy Corp. fell the most in almost 14 years after lenders cut the Canadian oil and gas producer’s credit facility for the second time since December.

Low expectations of OPEC’s June 2 meeting suggest that “any surprise could have an outsized impact,” Morgan Stanley said in a research note.