Connect with us

Hi, what are you looking for?

Commodities & Futures

Oil dips, but heads for third weekly rise on demand recovery

Commodities55 minutes ago (Jun 11, 2021 03:20AM ET)

(C) Reuters. FILE PHOTO: Oil storage containers are seen, amid the coronavirus disease (COVID-19) pandemic, in Los Angeles, California, U.S., April 7, 2021. REUTERS/Lucy Nicholson

By Shu Zhang and Sonali Paul

SINGAPORE (Reuters) -Oil prices slipped on Friday but were set for their third weekly rise on expectations of a recovery in fuel demand in Europe, China and the United States as rising vaccination rates lead to an easing of pandemic curbs.

Brent crude futures edged down 4 cents, or 0.06%, to $72.48 a barrel to 0658 GMT, after closing at its highest since May 2019 on Thursday.

U.S. West Texas Intermediate (WTI) crude futures also slipped 4 cents, or 0.06%, to $70.25 a barrel, after climbing 0.5% on Thursday to its highest close since October 2018.

Brent is set for a weekly rise of 0.8% while WTI is set to gain 0.9%.

U.S. investment bank Goldman Sachs (NYSE:GS) expects Brent crude prices to reach $80 per barrel this summer, betting that a recent oil market rally will continue as vaccination rollouts boost global economic activity and demand for the commodity.

Saudi Arabia, the world’s top oil exporter, will supply full volumes of July-loading crude to its Asian customers, Reuters reported on Friday citing sources.

“News that Saudi Arabia has unwound all its voluntary production cuts are circulating in Asia today, and that appears to have temporarily pushed oil prices lower,” Jeffrey Halley, senior market analyst at OANDA, wrote in a note.

“The reaction is modest, though, and if anything, the price action is bullish. It suggests that the physical market has absorbed extra Saudi production with ease and that demand globally is robust and climbing.”

Gasoline inventories in the United States, the world’s biggest oil consumer, rose by 7 million barrels in the week to June 4, and distillate stockpiles rose by 4.4 million barrels, both much more than analysts had expected, according to data from the U.S. Energy Information Administration on Wednesday. [EIA/S]

That unexpected surge spurred profit-taking as prices hit a two-and-half year high, said Margaret Yang, a strategist at DailyFX.

Additionally, data showing road traffic returning to pre-COVID-19 levels in North America and most of Europe was encouraging, ANZ Research analysts said in a note.

“Even the jet fuel market is showing signs of improvement, with flights in Europe rising 17% over the past two weeks, according to Eurocontrol,” ANZ analysts said.

The Organization of the Petroleum Exporting Countries (OPEC) reinforced the view of healthy demand, sticking to its forecast that demand in 2021 would rise by 5.95 million barrels per day, up 6.6% from a year earlier.

“Overall, the recovery in global economic growth, and hence oil demand, are expected to gain momentum in the second half,” OPEC said in its monthly report on Thursday.

Oil dips, but heads for third weekly rise on demand recovery

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Uncategorized

Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit, sed quia non numquam eius modi tempora incidunt.

Uncategorized

Nemo enim ipsam voluptatem quia voluptas sit aspernatur aut odit aut fugit, sed quia consequuntur magni dolores eos qui ratione.

Uncategorized

Quis autem vel eum iure reprehenderit qui in ea voluptate velit esse quam nihil molestiae consequatur, vel illum qui dolorem eum.

Uncategorized

Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit, sed quia non numquam eius modi tempora.

Disclaimer: Buzzclever.com it's managers and its employees (collectively "The Company") do not make any guarantee or warranty about what is advertised or above. Information provided by this website is for research purposes only and should not be considered as personalized financial or health advice. Copyright © 2021 Buzz Clever. All Rights Reserved