Bloomberg - Oil rose above $34 a barrel following a prediction from Russia that the market may rebalance as early as next month after historic output cuts from global producers to drain a glut.

Russia, a member of the OPEC+ alliance that has pledged to trim supply by almost 10 million barrels a day, expects the market to balance in June or July. Energy Minister Alexander Novak said global curbs have so far exceeded those agreed by the coalition. Futures in New York were 3.7% higher from Friday’s close after there was no settlement Monday due to a holiday.

Oil has surged more than 80% this month as demand returned following the easing of lockdown restrictions in some countries, while output cuts have started to chip away at the oversupply. The International Energy Agency sees oil consumption eventually rebounding past pre-virus levels, but others believe demand may never recover to what it once was.

The world consumed nearly 100 million barrels a day of oil last year, which some in the energy industry believe could mark the peak for demand. Their hypothesis is that the coronavirus pandemic will trigger changes of lifestyle like working-from-home and less overseas travel.

“The market is starting to witness the effect of output cuts along with a reduction in inventories, while the global economy is on its path to recovery,” Will Sungchil Yun, commodities analyst at VI Investment Corp., said by phone from Seoul. “Still, there’s caution with the absence of a cure for the pandemic as well as the possibility of a second wave of infections.”

PRICES

• West Texas Intermediate crude for July delivery rose $1.24 from Friday to $34.49 a barrel on the New York Mercantile Exchange as of 7:35 a.m. London time
• Brent for July settlement added 2.1% to $36.27 after climbing 1.1% to close at $35.53 on Monday