Oil prices rose in early trade on Wednesday as OPEC stuck to forecasts of stronger global fuel demand, after an unexpected rise in consumer prices in August and the US Federal Reserve’s interest rate cut next week. Allayed fears of another surge.
Brent crude futures were up 3 cents at $93.20 a barrel by 0116 GMT after falling 0.9 percent on Tuesday. U.S. West Texas Intermediate crude was up 10 cents, or 0.1 percent, at $87.41 a barrel.
The Organization of the Petroleum Exporting Countries (OPEC) on Tuesday reiterated its forecast for global oil demand to grow in 2022 and 2023, citing signs that major economies are performing better than expected despite rising inflation. are demonstrating
Oil demand will rise by 3.1 million barrels per day (bpd) in 2022 and 2.7 million bpd in 2023, OPEC said in its monthly report, unchanged from last month.
“Less measures in oil prices suggest that tight supply is still an underlying issue in physical markets, especially with OPEC’s positive demand outlook on Tuesday,” said Tina Teng, an analyst at CMC Markets. after the”.
Oil prices were also helped by reports that the US Biden administration is considering replenishing its strategic oil reserves, as well as the West’s 2015 nuclear deal with Iran, analysts at ANZ Research said in a note. Low market expectations for recovery.
Weighing on oil and financial markets, however, was a warmer-than-expected U.S. inflation report on Tuesday that ended hopes that the Fed could pull back from tightening its rate policy in coming months. Read more
Fed officials are scheduled to meet next Tuesday and Wednesday, with inflation remaining above the U.S. central bank’s 2% target.
In China, the ongoing COVID-19 lockdown is squeezing fuel demand in the world’s largest oil importer. Read more
“China’s zero-COVID policy remains in place and will limit any recovery that emerges in the coming weeks,” Edward Moya, a senior market analyst at OANDA, said in a note.
“The US is a big wild card and if this demand outlook weakens, oil could resume its downward trajectory that has been ongoing since the start of the summer.”
On the supply side, U.S. crude stocks rose by nearly 6 million barrels for the week ended Sept. 9, according to market sources citing data from the American Petroleum Institute on Wednesday.
