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Oil storage tanks in the Keihin industrial area in Yokohama, Kanagawa Prefecture, Japan on April 10, 2023. Picture: Toru Hanai/Bloomberg
Singapore — Oil prices rose on Tuesday on expectations that inventories in the US, the world’s biggest crude consumer, are expected to fall and on signs that demand in emerging markets remains healthy.
Crude futures likely received a boost from gains in Asian equity markets as regional central banks are expected to keep their interest rates steady.
Signs of strong fuel demand in India, the world’s third-biggest oil consumer, in March also supported prices. Last month, fuel consumption jumped by 5% from a year earlier to a record 4.83-million barrels a day. The country continues to be the main destination for Russian Urals crude amid the resorting of global oil trade flows in the wake of the invasion of Ukraine.
Brent crude rose 57c, or 0.68%, to $84.75 a barrel at 4.25am GMT, while US West Texas Intermediate gained 60c, or 0.75%, to $80.34.
Oil futures have climbed more than 5% since oil cartel Opec and allies including Russia surprised the market last week with a new round of production cuts starting in May.
On the US supply front, industry data on US crude stockpiles is due on Tuesday. Five analysts polled by Reuters estimated on average that crude inventories fell by about 1.3-million barrels in the week to April 7.
Oil prices fell on Monday after rising for three straight weeks, after US jobs data pointed to a tight labour market, heightening expectations of another Federal Reserve rate hike that could curb oil demand.
Rate hike expectations boosted the US dollar index on Monday and Tuesday, which weighed on oil prices as dollar strength makes oil more expensive for other currency holders.
A US inflation report to be released on Wednesday could help investors gauge the near-term trajectory for interest rates.
In Asia, data from China showed that consumer inflation data in March hit the slowest pace since September 2021 suggesting demand weakness persists amid an uneven economic recovery.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Oil prices rise as demand signs stay strong
Singapore — Oil prices rose on Tuesday on expectations that inventories in the US, the world’s biggest crude consumer, are expected to fall and on signs that demand in emerging markets remains healthy.
Crude futures likely received a boost from gains in Asian equity markets as regional central banks are expected to keep their interest rates steady.
Signs of strong fuel demand in India, the world’s third-biggest oil consumer, in March also supported prices. Last month, fuel consumption jumped by 5% from a year earlier to a record 4.83-million barrels a day. The country continues to be the main destination for Russian Urals crude amid the resorting of global oil trade flows in the wake of the invasion of Ukraine.
Brent crude rose 57c, or 0.68%, to $84.75 a barrel at 4.25am GMT, while US West Texas Intermediate gained 60c, or 0.75%, to $80.34.
Oil futures have climbed more than 5% since oil cartel Opec and allies including Russia surprised the market last week with a new round of production cuts starting in May.
On the US supply front, industry data on US crude stockpiles is due on Tuesday. Five analysts polled by Reuters estimated on average that crude inventories fell by about 1.3-million barrels in the week to April 7.
Oil prices fell on Monday after rising for three straight weeks, after US jobs data pointed to a tight labour market, heightening expectations of another Federal Reserve rate hike that could curb oil demand.
Rate hike expectations boosted the US dollar index on Monday and Tuesday, which weighed on oil prices as dollar strength makes oil more expensive for other currency holders.
A US inflation report to be released on Wednesday could help investors gauge the near-term trajectory for interest rates.
In Asia, data from China showed that consumer inflation data in March hit the slowest pace since September 2021 suggesting demand weakness persists amid an uneven economic recovery.
Reuters
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