Oil climbs to more than 1-week high amid bullish momentum

Oil prices extended overnight gains in North American trading on Thursday, climbing to a more than one-week high, boosted by the likelihood that key crude producers will extend output cuts beyond an agreed-on June deadline.

The U.S. West Texas Intermediate crude June contract tacked on 69 cents, or around 1.4%, to $48.02 a barrel by 9:05AM ET (13:05GMT), after rising to a one-week high of $48.16 earlier. The U.S. benchmark surged $1.45, or around 3.2%, on Wednesday.

Elsewhere, Brent oil for July delivery on the ICE Futures Exchange in London rose 69 cents to $50.91 a barrel. The global benchmark rallied $1.49 a day earlier.

Iraqi petroleum minister Ali al-Luiabi said there is an emerging consensus among OPEC and non-OPEC countries to extend an output cut agreement for six more months to help clear a supply glut.

In November last year, OPEC and other producers, including Russia agreed to cut output by about 1.8 million barrels per day between January and June, but so far the move has had little impact on inventory levels.

A final decision on whether or not to extend the deal beyond June will be taken by the oil cartel on May 25.

Oil futures posted their largest one-day gain since December 1 on Wednesday after the U.S. Energy Information Administration said crude oil inventories fell by 5.2 million barrels in the week ended May 5, far exceeding market expectations. The reading marks the biggest weekly drawdown since December.

The EIA also said that gasoline stockpiles declined by 200,000 barrels, while distillate stockpiles were down 1.6 million barrels last week.

Crude sank to a five-month low earlier this week, rattled by concern over increasing U.S. crude output that has shaken investors' faith in the ability of OPEC to rebalance the market.

Elsewhere on Nymex, gasoline futures for June inched up 1.6 cents, or nearly 1.1%, to $1.560 a gallon, while June heating oil added 1.3 cents to $1.489 a gallon.

Natural gas futures for June delivery tacked on 3.1 cents to $3.323 per million British thermal units, as traders looked ahead to weekly storage data due later in the global day.