Refined oil pours from a pipe in the village of Wonocolo, East Java, Indonesia (Photographer: Dimas Ardian/Bloomberg)

Oil Hasn't Started a Year This Hot Since the Turn of the Century

(Bloomberg) -- Oil hasn’t started off this strong in 18 years.

After closing out 2018 in free-fall amid fears of a global supply glut and economic slowdown, U.S. crude prices have rebounded more than 18 percent to start this year. That’s the biggest climb over the first 13 trading days since January 2001, according to New York Mercantile Exchange data compiled by Bloomberg.

Oil Hasn't Started a Year This Hot Since the Turn of the Century

The swift climb higher has coincided with a steep drop in volatility. After reaching its highest level in more than two years, an index tracking West Texas Intermediate crude options prices has sunk to the lowest since November.

Why all the optimism? Analysts and traders credit progress in U.S.-China trade talks, a more dovish stance on interest-rate hikes from the Federal Reserve and signs that OPEC-led production cuts are starting to take a bite out of supplies.

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