By Myra P. Saefong
Published: Apr 30, 2015 12:14 p.m. ET

Nymex oil prices are at their highest level of the year.

U.S. crude supplies have stood at a record high since January, with little hope for a reprieve from the 46% price drop the market suffered in 2014.

Crude supplies remain at a record, but the outlook for the market is starting to improve as the number of U.S. rigs actively drilling for oil continue to fall, supplies at the nation’s storage hub begin to drop and tensions in the Middle East raise concerns over the potential disruptions to global supplies.

Chart 1: Nymex crude prices

Futures prices for crude oil CLM5, +1.50% on the New York Mercantile traded around $106 a barrel in June of last year and dropped by more than 50% to a low around $45 by March.

But on Wednesday, crude for June delivery settled at $58.58 a barrel — the highest settlement of the year so far. On Thursday, June crude tacked on 62 cents, to trade at 59.21 a barrel.

At this rate, prices are set for a monthly gain of more than 23% and trade —the largest gain in a month since May 2009, FactSet data show.

Much of the price gains over the past several weeks can be attributed to worries about global oil supplies and transport in the Middle East, which have been fed by tensions in Yemen.

Chart 2: U.S. crude supplies, excluding Strategic Petroleum Reserves

Overall crude inventories remain at record, based on EIA data going back to the 1980s, with stockpiles up a 16th week in a row, as this chart courtesy of WTRG Economics, based on EIA data, shows.

The increase of 1.9 million barrels for the week ended April 24, however, was much smaller than the 4.2 million-barrel increase the American Petroleum Institute reported for that week.

The only smaller build in the past 16 weeks was reported on April 15th, when supplies rose 1.3 million barrels, said Tyler Richey, an analyst for the 7:00’s Report.

Still, with supplies at such high levels and economic data continuing to disappoint, Richey said he’s “cautious on this six-week counter-trend rally.”

Chart 3: U.S. crude supplies at Cushing

Supplies at the Cushing, Okla., U.S. storage hub show a steady climb since the start of the year, but for the week ended April 24, they fell roughly 500,000 barrels. Traders saw the decrease as a sign that the nation’s supply glut may soon start to ease.

This was the first weekly drop at Cushing since the end of November, said James Williams, an energy economist at WTRG Economics.

Crude storage at Cushing had reached a record at more than 62 million barrels as of the week ended April 17, according to EIA data dating back to April 2004.

Chart 4: Oil rig counts

The number of U.S. rigs actively drilling for oil has fallen for 20 weeks straight.

As of April 24, the number of active oil rigs stood at 703, down 31 rigs from the previous week, according to data from Baker Hughes BHI, -0.19%

Traders expect that several weeks of declines in the number of U.S. rigs actively drilling for oil will soon translate into sizable declines in domestic oil production.

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