Oil Below $80 'Not a Problem' for Oman, Minister Says
Oil headed for a fourth weekly gain amid tentative signs that global markets are tightening.
Brent futures advanced 0.6 per cent in thin trading volumes, holding above US$80 a barrel in London. Russia has shown signs of paring crude exports as it belatedly honors a pact with Saudi Arabia and the OPEC+ alliance to help balanace world markets. Prices were also bolstered as China, the world's biggest crude importer, stepped up efforts to boost its flagging economic recovery.
Volumes often taper off during the summer holiday period and traders have been reducing their exposure in crude markets, sharply curbing open interest in West Texas Intermediate. The U.S. benchmark is also on track for fourth straight weekly increase.
Crude has ticked higher since late June on signs the market is tightening, but remains lower for the year. China's lackluster recovery has been a major drag on demand, as has the Federal Reserve's aggressive monetary policy.
The U.S. central bank is expected to raise rates next week and odds for a further move higher went up slightly after initial jobless claims data, released Thursday, pointed to continued labor-market strength.
“Crude prices have struggled for direction this week, amidst a tug-of-war between the fragile demand picture and a supportive supply outlook,” analysts at consultants FGE said in a report. “Despite this week's underwhelming price performance, we remain cautiously bullish given the tightening supply outlook.”
- WTI for September delivery rose 0.7 per cent to US$76.15 a barrel at 9:16 a.m. in London.
- Brent for September settlement gained 0.6 per cent to US$80.14 a barrel.