The specter of expanding U.S. supply haunting the oil market is being beaten back by Wall Street banks’ faith in a price rally.

U.S. futures are on course to end the week little changed, after they were whipsawed by concern about rising American production and optimism over rosy outlooks painted by forecasters including Goldman Sachs Group Inc. West Texas Intermediate crude in New York has rebounded 2.5 percent, recouping almost all of its losses over Monday and Tuesday.

Crude has remained above $60 a barrel since late December, boosted by shrinking U.S. stockpiles and a weaker dollar, extending an advance from June amid OPEC-led output cuts to clear a glut. Goldman hiked its price forecast, saying the market is now likely balanced, joining other Wall Street banks including Morgan Stanley and JPMorgan Chase & Co. in raising its outlook. Still, the rally’s an incentive for American drillers to pump more.

“There’s a tendency at the moment that the market wants to continue this bull run,” Will Yun, a Seoul-based commodities analyst at Hyundai Futures Corp., said by phone. “Fundamentally speaking, there’s a high chance that the U.S. will boost production and conflicts could also increase among OPEC nations if prices continue to surge.”

WTI for March delivery added as much as 50 cents to $66.30 a barrel on the New York Mercantile Exchange and traded at $66.10 at at 8:33 a.m. in London. The contract rose 1.7 percent to $65.80 a barrel on Thursday. Total volume traded was about 40 percent above the 100-day average. Front-month futures are down about 0.1 percent this week.

Brent for April settlement was at $69.87 a barrel on the London-based ICE Futures Europe exchange, up 22 cents. The contract rose 76 cents to $69.65 a barrel on Thursday. The global benchmark crude traded at a premium of $4.05 to April WTI.

Goldman sees Brent crude reaching $75 a barrel over the next three months and will climb to $82.50 within six months. Its previous estimate for both time periods was $62 a barrel. The bank’s bullish outlook is driven by its revised demand forecasts, reflecting stronger economic growth in emerging markets.

U.S. output surged above 10 million barrels a day for the first time in more than four decades in November, the Energy Information Administration reported Wednesday. Nationwide crude inventories climbed 6.78 million to 418.4 million barrels last week, the first increase in 11 weeks, according to the EIA. Meanwhile, production from the Organization of Petroleum Exporting Countries in January added just 20,000 barrels a day.

Gasoline futures on the Nymex added 0.5 percent to $1.9003 a gallon. Front-month prices are down 1.9 percent this week, the first loss in about a month.

Oil-market news:

• Oilmen, wildcatters and refiners are reaping billions in windfalls from President Donald Trump’s new tax code, helping boost the staying power of old-style energy even as the world searches for cleaner fuels.
• ConocoPhillips has begun deploying the spoils of the oil price rally, announcing a dividend boost and share buybacks along with a $400 million expansion in Alaska in its fourth-quarter earnings report.