US investment bank Citi says commodity assets under management (AuM) in February registered the sharpest monthly uptick since its own datasets began in 2007.

In a research note to clients on Tuesday, Citi said retail and institutional passive index, ETF and hedge fund AuM linked to commodities rose 41% month-on-month and 8% on an annual basis to $337.5bn.

Last week alone, index and ETF AuM saw inflows of $4bn, bringing year-to-date investments to $23bn.

The stats follow an oil price rebound this year, with the price of a barrel of Brent Crude up to $40 - nearly 50% from its recent January low of $28.

Gold has also had a strong start to the year with the precious metal up 20% year-to-date to $1,275.

“We continue to see global non-OPEC supply pulling back throughout the year which should underpin a more sustainable oil price rally,” said Akash Doshi, director in Citi’s global commodities research team.

“But we struggle to see a year-end scenario where oil prices rise to $50 per barrel but gold prices remain supported above $1,200 per ounce and bias our outlook to moderately bearish by the fourt quarter of 2016," he added.

In terms of metals, the best performing commodities year-to-date are manganese (+49%); iron ore (+31%), alumina (+21%) & zinc (+21%).

“There are a few macro influences at play,” says Daniel Morgan, commodities analyst at UBS on Tuesday.

“Firstly, further policy support in China & a renewed focus by the central government on economic growth rather than reform has boosted demand expectations there.

“Changing rates expectations in the US has brought USD weakness. Commodity funds have received large inflows. Naturally, short covering has played its part too.”

CFTC data shows that speculators have bought 450 kilo-tonnes of metal, moving from a near record net-short position in January to a small net-long.

Morgan adds that the current surge in commodity prices may be a short term phenomenon from oversold market recovery and/or seasonal factors.

“Here, restocking activity and a normal seasonal lift of China's peak materials consumption mid-year could be at play," adds UBS' Morgan.

“Alternatively, we may actually find in a few months' time that a fundamental tightening of markets occurred in the first quarter of 2016."

“As prices climbs the cost curve, some operators may be tempted to bring assets back from care & maintenance."