Oil prices rose on Friday, gaining for the fifth week in a row as investors are optimistic that healthy demand growth and supply cuts will keep prices buoyant.
Risk appetite in the broader financial markets and rising expectations that central banks such as the US Federal Reserve and the European Central Bank are nearing the end of their policy tightening campaigns strengthen the outlook for global growth and energy demand.
Supported by the supply cuts announced by the OPEC+ alliance earlier this month, both oil benchmarks posted gains for the fifth week in a row, up nearly 5% during the week. The benchmarks are on track to earn over 13% for the month.
Brent crude rose 75 cents to $84.99, while West Texas Intermediate (WTI) crude rose 49 cents to $80.58.
Both indicators briefly dropped as much as $1 in the early hours of the session as traders took profits after WTI rallied above $80 a barrel.
New data released on Friday indicated some of the euro area’s major economies exposed unexpected resilience in the second quarter, as production problems and services slowed, as a number of indicators point to renewed weakness in the future.
Meanwhile, policymakers in China have pledged to increase stimulus measures to revive the post-COVID recovery after the world’s second-largest economy grew at a weak pace in the second quarter.
Exxon Mobil chairman Darren Woods said in an interview Friday that he expects record oil demand this year and next year.
On the supply side, U.S. oil rigs dropped to 529, the lowest level since March 2022 this week, Baker Hughes said on Friday, as an indication of future supply.
OPEC oil production this month may have fallen to its lowest level since autumn 2021, analysts said, adding that evidence for tightening is mounting given declining US inventories and Saudi Arabia’s voluntary cut of 1 million barrels per day.
Some analysts said Saudi Arabia is expected to extend its voluntary oil production cut for another month including September to provide additional support to the oil market.
