Sun, Apr 16, 2023 page10
Oil posts its fourth weekly gain, as IEA forecasts price rise
Bloomberg
Oil on Friday rose for the fourth straight week, supported by signs of a tightening global market that have the International Energy Agency (IEA) warning of higher prices ahead.
West Texas Intermediate for May delivery rose 0.44 percent to close at US$82.52 per barrel, rising 2.25 percent weekly to post its longest run of weekly advances since June last year.
Brent crude for May delivery increased 0.26 percent to US$86.31 per barrel, gaining 1.4 percent for the week.
A worker operates an electric drilling rig in Broomfield, Colorado, on Dec. 2, 2021.
Photo: Reuters
Crude is hovering near five-month highs after OPEC+ surprised the market with plans to cut more than 1 million barrels of daily output. Declining US stockpiles, weaker flows from Russia and interruptions to pipeline supplies from Iraqi Kurdistan have added to the gains.
Markets are digesting a week of mixed projections for crude supply and demand.
The latest OPEC+ cuts threaten to boost oil prices for consumers already facing high inflation, the IEA said in its monthly outlook on Friday.
The cartel had forecast a day earlier that markets would be deeply undersupplied. In contrast, the US Energy Information Administration projected supplies surpassing demand this year and next.
Demand from the world’s largest crude importer is supporting prices as well. Recent data show that China imported the most oil in three years last month, underpinned by record Russian flows.
On Friday, People’s Bank of China Governor Yi Gang (易綱) said the nation’s economy is expected to grow about 5 percent this year.
Key technical measures are signaling a tighter market, too. West Texas intermediate’s prompt spread — the difference between its two nearest contracts — was at US$0.09 per barrel in backwardation. The bullish pattern is a stark reversal from when it was trading US$0.16 in contango a month earlier.
Additional reporting by staff writer
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