The price of oil rose on Monday after major producers agreed to extend an unprecedented production cut deal until the end of July, and with China's crude imports reaching its highest level ever in May.

In early trading today, Brent crude for August delivery rose 1.32% to $ 42.89 a barrel, while US West Texas crude for July delivery increased 1.1% to record $ 40 a barrel.

Both raw materials hit their highest level since March 6 earlier in the session today at $ 43.41 and $ 40.44, respectively.

Brent has nearly rallied to the country since the Organization of the Petroleum Exporting Countries, Russia and other allies - in what is known as OPEC Plus - agreed in April to reduce supply by 9.7 million barrels per day in May and June to support prices collapsed by the Corona virus.

On Saturday, OPEC Plus agreed to extend the agreement to withdraw about 10% of global supplies from the market for a third month until the end of next July.

OPEC said in a statement, on Saturday, that the coalition recognized that countries that did not comply with their cuts of the cut during the past month, compensate what they did not adhere to during the period between July and September 2020.

But economist at OBC Bank in Singapore, “Hui Li” indicated that the latest agreement did not live up to the market’s expectations that were to extend production cuts to three months.

A big gap

He said that both metrics will need stronger factors to bring prices back to levels before the sixth of last March, when it collapsed after OPEC and Russia then failed to reach an agreement on supply cuts.

"The gap is big, and it is imperative that a strong conviction be formed in order for the price to rise from $ 43 to pre-crash levels," economist Hui said, referring to Brent's price when it was above $ 50 before last March's crash, as reported by Reuters.

Crude imports accelerated by China, in a sign of the start of a global economic recovery.

But observers expressed their belief that the sustainability of price recovery may not continue in light of the deterioration of relations between Washington and Beijing, or the occurrence of a second wave of Corona injuries, as well as the return of US shale oil supplies to levels after the price hikes, according to the German Press Agency.

Analysts said in testimonies that the price hikes above the level of forty dollars a barrel will cover a large portion of the costs of American companies after they suffered bankruptcy risks over the past months and forced them to close production fields.

The analysts said that the continuation of the current price levels will enable American companies to resume stalled production, which reached about two million barrels per day by last May, according to Anatolia news agency.