Oil prices are set to end their two-week losing streak as they rise for the fourth consecutive session on Friday amid tighter supplies and expectations that the OPEC+ oil producers group will extend production cuts until the end of the year.
Brent crude was also up 26 cents, up 0.3%, at 06:05 GMT to $87.09 a barrel, while West Texas Intermediate crude (WTI) rose 21 cents, or 0.3%, to $83.84 a barrel.
WTI is up over 5% for the week, while Brent is up about 3%.
Analysts expect Saudi Arabia to extend its 1 million bpd voluntary oil production cut through October, in addition to cuts from the Organization of the Petroleum Exporting Countries and its allies known as OPEC+.
Expectations remain about extending the cuts and pulling OPEC supplies off the market, encouraging US shale oil producers to increase their drilling activities and achieving sustainable prices above US$90 per barrel.
Russia, the world’s second-largest oil exporter, has also reached an agreement with its OPEC+ partners to reduce oil exports, Russian Deputy Prime Minister Alexander Novak said on Thursday.
Government data on Wednesday showed US crude inventories fell by 10.6 million barrels last week, more than expected. Commercial crude oil inventories have decreased by 34 million barrels since mid-July.
Traders and investors often see changes in US oil stocks as an indicator of changes in the global production-consumption balance, and spot prices and spreads can increase if stocks are continually depleted.
Gasoline demand rose for the first time in three weeks, with signs of stronger demand also appearing in the product market.
The weakened US dollar, which seems to have ended its six-week streak, also provided support for prices. A weakening dollar causes oil to become cheaper for buyers who hold other currencies, increasing demand for oil.
According to a survey, factory activity in China has returned to expansion, and Beijing’s moves to support China’s struggling housing market will help boost demand from the world’s second-largest oil consumer. It is also what helped boost oil prices on Friday.