Oil prices rose on Monday as fears of a recession began to abate after the US fell for three consecutive weeks for the first time since November.
Brent crude futures rose 43 cents, or 0.6%, to $75.73 a barrel at 0624 GMT. West Texas Intermediate (WTI) crude futures were up 45 cents, again up 0.6% at $71.79 a barrel.
Energy stocks rallied on Wall Street last Friday as strong jobs data eased concerns about the recent recession in the US and skepticism that had boosted sales earlier in the week.
Fears that the US banking crisis will slow the economy and reduce fuel demand in the world’s largest oil-consuming country dropped Brent 5.3% last week, while WTI fell 7.1%.
However, a healthy US jobs report for April, a weaker dollar, and prospects for supply cuts at the Organization of the Petroleum Exporting Countries and its allies at the OPEC+ meeting in June helped its benchmarks rise 4% on Friday.
Crude oil prices are trying to stabilize as energy traders wait to see if OPEC+ will signal their willingness to cut production further.
It should not be overlooked that the growing global supply is overinflated due to the stress in the US banking system and concerns about short-term demand due to the industrial slowdown and limited compliance with the OPEC+ cuts.
Some analysts maintain their Brent price forecast of $95 a barrel for December and $100 for April, saying they believe the market focus will now shift from economic concerns to tightening oil supplies.
The US is expected to release April consumer price inflation figures on Wednesday, which may provide more clues about interest rate moves amid broad expectations that the US Federal Reserve will pause on rate hikes.
As market participants continue to gauge the economic recovery in the world’s second-largest oil consumer, this week traders will also watch Chinese economic indicators, including trade, inflation, lending, and money supply figures for April.
