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(Bloomberg) — Oil traded near a 10-month high as the physical market showed fresh signs of tightness driven by supply cuts from OPEC+ leaders.

Global benchmark Brent edged toward $95 a barrel, advancing for a fourth straight day. Premiums for physical barrels are surging as refiners struggle to make enough diesel ahead of a seasonal ramp-up in demand. The tighter market has spurred predictions from the likes of Chevron Corp. Chief Executive Officer Mike Wirth that $100 oil will return.

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Crude has rallied by more than 30% since mid-June as Saudi Arabia and Russia curtailed exports in a bid to drain inventories and drive a rebound in prices. An improving outlook in the world’s two biggest economies — the US and China — has also supported oil’s advance. The surge in energy costs looks set to boost inflationary pressures, complicating the task facing central bankers.

“Risks of a short-term spike to $100 may be rising with the current momentum but we have little conviction it would be sustainable,” said Charu Chanana, market strategist at Saxo Capital Markets Pte. “Higher inflation could mean tighter monetary policies and OPEC+ can’t control the demand side.”

Saudi Arabia Energy Minister Prince Abdulaziz bin Salman said on Monday that the Organization of Petroleum Exporting Countries is working to keep oil markets stable and improve global energy security, without targeting any specific price level. Output plans will be reviewed every month, he said.

Underlying market metrics point to near-term tightness. Brent’s three-month spread has widened to $3.60 a barrel in backwardation, a bullish pattern. That compares with a differential of $1.26 a barrel about a month ago.

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