Oil steady on mixed signals from Opec+ and dollar strength

London — Oil prices were stable on Friday, as the market weighed conflicting messages on supply from Russia and Saudi Arabia ahead of the next Opec+ policy meeting, a stronger US dollar and worries of weaker-than-expected demand growth.

Brent crude was up 40c at $76.66 a barrel at 9.59am GMT, while US West Texas Intermediate (WTI) rose 54c to $72.37 a barrel.

Benchmarks settled more than $2 a barrel lower on Thursday, after Russian Deputy Prime Minister Alexander Novak played down the prospect of further Opec+ production cuts at its meeting in Vienna on June 4.

Both prices were still poised to post a second week of gains of slightly less than 1%. A deal to raise the US debt ceiling, which appears in sight, would likely boost oil prices.

Russian President Vladimir Putin said on Wednesday that energy prices were approaching “economically justified” levels, also indicating there could be no immediate change to the group’s production policy.

Their remarks contrasted with comments this week from Saudi Arabian energy minister Prince Abdulaziz bin Salman, the de facto leader of the Opec, warning short sellers to “watch out”.

Some investors interpreted that as a signal Opec+ could consider further output cuts.

Worries of weaker-than-expected demand growth globally also weighed on investor outlook ahead of an expected rise in the second half of the year, especially from China.

Meanwhile, bets on falling oil prices are on the rise.

The dollar has strengthened this month against a basket of peers, making dollar-denominated commodities such as oil more expensive for those holding other currencies. 

Reuters