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LONDON – Brent oil futures prices ticked higher on Friday and were on course for their best week in more than four months after projections for solid crude oil and fuel demand in 2024.
Brent crude futures were up 53 cents at $83.28 a barrel at 1356 GMT. West Texas Intermediate (WTI) U.S. crude futures were up 41 cents at $79.03.
Brent and the U.S. benchmark have gained almost 4.5% over the week. That would mark Brent’s highest weekly rise in percentage terms since the week to Feb. 9. WTI is on course for the biggest weekly rise since the week to April 5.
Prices dipped last week after a decision by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, to phase out output cuts starting from October.
But sentiment shifted this week after the International Energy Agency (IEA), the U.S. Energy Information Administration (EIA) and OPEC updated their views on the global oil demand-supply balance for 2024.
While the EIA upgraded its oil demand growth estimate slightly, OPEC stuck to a forecast for relatively strong growth of 2.2 million barrels a day (bpd). The IEA, meanwhile, cut its demand growth forecast to under a million bpd.
However, all three forecasters predicted a supply deficit at least until the beginning of winter, Commerzbank analysts highlighted.
Still, this week’s rally cooled somewhat after the U.S. Federal Reserve kept interest rates on hold, with the start of rate cuts unlikely before December.
“In view of the still uncertain economic outlook for the major economic regions, a further price increase is not to be expected for the time being,” said Commerzbank analyst Barbara Lambrecht.
Elsewhere, Russia pledged to meet its output obligations under the OPEC+ pact after saying it exceeded its quota in May.
“No matter how many times it promises to make up for poor compliance at a future date, the market just sees more oil and an agreement that might just possibly unravel,” said PVM analyst John Evans.
Market focus is also on Gaza ceasefire talks, which could alleviate concerns about potential disruption to oil supply from the region.
(Reporting by Robert Harvey and Natalie Grover in London and Ashitha Shivaprasad in Singapore; Addititonal reporting by Katya Golubkova in Tokyo; Editing by David Goodman and Mark Potter)
