Oil on Track for Fifth Week of Gains

Oil prices were steady on Friday but on track for a fifth straight week of gains. This is with investors optimistic healthy demand and supply cuts will keep prices buoyant.

Risk appetite in wider financial markets has been fuelled by growing expectations. The expectation is that central banks are nearing the end of policy tightening campaigns. What banks? The Fed and European Central Bank. It is boosting the outlook for global growth and energy demand.

Both oil benchmarks are on track for a 3.6% weekly increase – a fifth straight week of gains. This is bolstered by supply cuts from the OPEC+ alliance announced earlier this month.

By 1229 GMT, Brent crude slipped 9 cents to $84.15 a barrel, while U.S. West Texas Intermediate (WTI) crude dipped 3 cents to $80.06 a barrel.

Bullish demand expectations were boosted on Thursday after U.S. second-quarter gross domestic product grew at a forecast-beating 2.4%, supporting Federal Reserve Chairman Jerome Powell’s view that the economy can achieve a so-called “soft landing.”

Investors are warming up to the idea of peak rates getting ever closer, while it is looking increasingly probable that the United States will avoid recession, said PVM analyst Tamas Varga.

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Source: Oil & Gas 360

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