Oil prices remained unchanged on Friday, with Brent is held around $ 70 a barrel with strong US economic data and expectations for a strong recovery in global demand in the third quarter. With the lifting of the sanctions, the prices that are expected to increase by the help of demand are more than balanced by the supply from Iran.
Brent crude futures for July fell 9 cents per barrel, or 0.1%, to $ 69.37 at 0643 GMT, while West Texas Intermediate (WTI) crude for July increased by 5 cents per barrel, or 0.1%, to 66.90.
This is a sign that prices are reaching resistance levels. Unless there is a very good reason to break above $70, $65-70 looks to be a holding zone.
Both Brent and WTI are on track to earn between 5% and 6% weekly, as global oil demand expects to ease the Covid 19 shortage following widespread vaccination programs, and approach 100 million barrels a day in the third quarter with summer travels to Europe and the United States.
Gasoline demand has nowadays surpassed 2019 levels, partially offset by lower demand in Asia, where new waves of COVID-19 infections have led to lower consumption.
Strong economic data from the United States, the world’s largest economy and oil consumer, also increased risk appetite. The number of Americans making new claims for unemployment benefits fell to the lowest level since mid-March 2020, beating estimates.
Looking to balance prospects for a recovery in demand against a possible increase in Iranian supply, its allies, including the Organization of Petroleum Exporting Countries and Russia, are likely to remain loyal to the pace of gradually easing oil supply restrictions.
Another 1 million barrels of oil per day will certainly slow the current decline in inventories and limit price rise.
Iran and the global powers have been in negotiations since April to take the steps that Tehran and Washington should take in sanctions and nuclear activities to fully comply with the 2015 nuclear pact.
Analysts expect Iran to add between 500,000 barrels and 1.5 million barrels of crude oil and condensate a day after the sanctions are lifted.
