Investors are jumping headfirst into risk assets to start the week, with stocks and oil rocketing higher on Sunday, and building on those gains in Monday trading.

Crude oil prices exploded to the highest level since early April on Monday, on optimism related to oil output cuts and investors risking capital based on hoped that less stringent lockdowns will elevate demand for fuel as workers begin to repopulate the economic landscape in offices across America and the globe.

West Texas Intermediate crude futures surged as much as 13%, to $33.32 per barrel before falling back to around $31.50. Brent crude, the international benchmark, climbed 10%, to $35.72 at intraday highs.

Crude oil ETFs, which were already the recipient of gains starting last week, continued to make moves higher today. The ProShares Ultra Bloomberg Crude Oil (UCO) rocketed over 14% Monday, while the Invesco DB Oil Fund (DBO) climbed 5.68%

Naeem Aslam, the chief market analyst at AvaTrade, bubbled with optimism, noting it appeared to be a “remarkable day” for both WTI and Brent.

“The global economy is reopening and the oil glut has eased off,” he said.

The combination of global production cuts and recovery projections has been urging oil prices higher, Jeffrey Halley, Oanda’s senior market analyst for the Asia Pacific, said in a note on Friday.

OPEC and its allies achieved a deal to slash oil production by 9.7 million barrels per day in May and June to bolster the price of the commodity, after prices plummeted earlier this year, reaching negative territory for the first time in history recently, as the coronavirus pandemic sunk economic activity and Saudi Arabia and Russia were engaged in a contentious oil-price war.

While the risk for the coronavirus infection still remains high, several US states have eased some lockdown measures. As of Friday, Georgia, South Carolina, and Montana had removed shelter-in-place orders, while others including Texas, Maine, and Illinois had cut back some restrictions.

The cocktail of supply cuts and increasing optimism for a demand recovery has helped to boost oil prices. Halley said WTI and Brent outperformed on Monday because of “China stimulus measures, decreasing supply and peak virus hopes.”

Although significant output cuts and the reopening of some of the largest economies in the world have improved the outlook for oil, many analysts are starting to question whether this rally isn’t becoming overcooked, as oil has climbed 385% in less than a month, and airlines remain largely shut-down as consumers remain on lockdown.

However, hopes for a continued rally in crude were reinforced Sunday as U.S. Federal Reserve Chairman Jerome Powell issued a more optimistic outlook for economic recovery later this year.

“Assuming there is not a second wave of the coronavirus, I think you will see the economy recover steadily through the second half of this year,” Powell said Sunday night in broadcast remarks.

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