Prices are on track for their second straight weekly gain
07 July 2023 - 11:44
byShadia Nasralla
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London — Oil prices rose on Friday and were on track for their second straight weekly gain, as resilient demand resulted in a larger-than-expected fall in US oil stockpiles, offsetting fears of higher interest rates.
Brent crude futures were up 31c, or 0.4%, at $76.83 a barrel at 0819 GMT, while US West Texas Intermediate crude gained 31c, or 0.4%, to $72.11 a barrel.
Both benchmarks were set to gain about 2% on the week.
Brent is still trading around $10 a barrel below April peaks and has remained between around $71 and $79 a barrel since early May in the face of interest rate hikes and weak Chinese economic data.
“The crude demand outlook is starting to look better as we enter peak summer travel in the US , and as the Saudis were able to raise prices to Europe and Asia,” said Edward Moya, an analyst at Oanda.
US crude stocks fell more than expected on strong refining demand, while gasoline inventories posted a large draw after an increase in driving last week, the Energy Information Administration said on Thursday.
However, oil price gains were capped by strengthening expectations that the US Federal Reserve is likely to raise interest rates at its July 25-26 meeting, which could weigh on growth and thus oil demand.
The number of Americans filing new claims for unemployment benefits increased moderately last week, while private payrolls surged in June, data showed on Thursday.
More US employment data is due at 1230 GMT.
Top oil exporters Saudi Arabia and Russia this week have also announced fresh output cuts for August. The total cuts by Opec and its allies now stand at around five million barrels per day (bpd), equating to 5% of global oil output.
Opec will likely maintain an upbeat view on oil demand growth for next year, sources close to the oil cartel said.
Investors will look for cues on rate paths from US and Chinese inflation data next week.
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 rises on resilient demand
Prices are on track for their second straight weekly gain
London — Oil prices rose on Friday and were on track for their second straight weekly gain, as resilient demand resulted in a larger-than-expected fall in US oil stockpiles, offsetting fears of higher interest rates.
Brent crude futures were up 31c, or 0.4%, at $76.83 a barrel at 0819 GMT, while US West Texas Intermediate crude gained 31c, or 0.4%, to $72.11 a barrel.
Both benchmarks were set to gain about 2% on the week.
Brent is still trading around $10 a barrel below April peaks and has remained between around $71 and $79 a barrel since early May in the face of interest rate hikes and weak Chinese economic data.
“The crude demand outlook is starting to look better as we enter peak summer travel in the US , and as the Saudis were able to raise prices to Europe and Asia,” said Edward Moya, an analyst at Oanda.
US crude stocks fell more than expected on strong refining demand, while gasoline inventories posted a large draw after an increase in driving last week, the Energy Information Administration said on Thursday.
However, oil price gains were capped by strengthening expectations that the US Federal Reserve is likely to raise interest rates at its July 25-26 meeting, which could weigh on growth and thus oil demand.
The number of Americans filing new claims for unemployment benefits increased moderately last week, while private payrolls surged in June, data showed on Thursday.
More US employment data is due at 1230 GMT.
Top oil exporters Saudi Arabia and Russia this week have also announced fresh output cuts for August. The total cuts by Opec and its allies now stand at around five million barrels per day (bpd), equating to 5% of global oil output.
Opec will likely maintain an upbeat view on oil demand growth for next year, sources close to the oil cartel said.
Investors will look for cues on rate paths from US and Chinese inflation data next week.
Reuters
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