By Gina Lee

Investing.com – Oil was up Monday morning in Asia, continuing an upward trend as the week begins. U.S. crude reached a seven year high. This indicates that there is still a strong demand for fuel as the economy recovers from COVID-19.

By 12:33 ET (or 4:33 GMT), the gain was 0.76%, or $85.28. The price rose to $84.55 by 0.94%.

Toshitaka Tazawa, a Fujitomi Securities Co. Ltd. analyst told Reuters that “bullish sentiment continues to support oils prices as global supplies remain tight at a moment when demand is recovering after the pandemic.”

Tazawa stated that WTI’s closest-term contract might not make any immediate gain due to steepening forwardwardation.

WTI futures have a steep backwardation and later-dated contracts trade at a cheaper price than current contract.

The black oil has seen a significant boost due to the continuing shortages of coal, gas, and other resources in China, India and Europe.

In another indication of market optimism, money managers increased their net long U.S. crude options and futures positions during the week ending Oct. 19.

Saudi Arabian crown prince  said over the weekend that his country aims to reach ‘net zero’ emissions of greenhouse gases by 2060, a decade later than the U.S. The country’s Energy Minister, Prince Abdulaziz bin Salman, told Bloomberg over the weekend that producers should not take the rise in prices for granted. Saudi Arabia is the world’s top oil exporter.

Meanwhile, U.S. energy firms last week cut oil and rigs for the first time in seven weeks even as oil prices rose, according to Friday’s Baker Hughes Co. report.