London — Oil prices edged higher on Friday, reaching fresh two-month highs and on track to post the strongest weekly gains this year as investors digested signs of an easing oversupply picture. US crude and petrol inventories fell much more steeply than expected this week and the world’s biggest oil exporter Saudi Arabia said it would further reduce oil output in August. Brent crude futures were up 22c at $51.71 a barrel at 9.31am GMT after reaching a fresh two-month high of $51.75 a barrel. The front of the crude oil curve jumped into backwardation, with the month-ahead trading above the subsequent month, showing investors are not expecting recent gains to last. US West Texas Intermediate (WTI) crude futures were flat at $49.04 a barrel, near a two-month high of $49.24. "Positive signs came from the draw in gasoline stocks this week, as the US moves into the peak driving season," said Ashley Kelty, oil analyst at Cenkos Securities. US crude stocks fell sharply by 7.2-million barrel...
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