May 10, 2024 10:57 AM IST
GLOBAL-OIL/ (UPDATE 1):UPDATE 1-Oil set for weekly gain as demand signs, geopolitics seen as positives
By Katya Golubkova and Sudarshan Varadhan
SINGORE, – Oil rose on Friday, set for a weekly gain, as data this week from the U.S. and China, the world’s two largest crude users, pointed to higher demand and continuing uncertainty over the Gaza war supported prices.
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Falling U.S. crude inventories spurred by higher refinery runs coincided with data released on Thursday showing China’s oil imports in April were higher than last year on signs of improving trade activity. Negotiations to halt the fighting between Israel and Hamas have yielded no results, keeping alive concerns of potential Middle East supply disruptions.
Brent futures rose 58 cents, or 0.6%, to $84.41 a barrel 0514 GMT and are set for a weekly gain of 1.7%. U.S. West Texas Intermediate crude climbed 58 cents, or 0.7%, to $79.84, set for a weekly increase of 2.2%.
China’s exports and imports returned to growth in April after contracting in the previous month, signalling an improvement in demand.
“Ongoing signs of strength in demand in China should see commodity market remain well supported,” ANZ Research said in a note.
Israeli forces bombarded the city of Rafah in the Gaza Strip on Thursday, Palestinian residents said on Thursday, while an Israeli official said indirect negotiations with Hamas had ended. As the conflict continues, it raises the potential for other Middle Eastern countries to become involved, particularly Hamas’ main supporter Iran, a key producer.
“Israel’s groundwork for an intervention in Rafah and growing tensions on its Northern border are a reminder that geopolitical risks could persist through all of Q2 2024, at least,” Citi analysts said in a note.
Still, the bank’s analysts see prices easing through 2024, with Brent averaging $86 a barrel in the second quarter and $74 in the third quarter amid looser supply and demand fundamentals as there are signs that global oil demand growth “appears to be moderating”.
This article was generated from an automated news agency feed without modifications to text.