Brent crude futures were up 0.6%, or 49 cents, at $83.45 a barrel and U.S. West Texas Intermediate crude futures rose 0.7%, or 60 cents, to $79.53
Oil prices rose on Friday, driven by demand in the world’s largest consumers, the United States and China, while the US Federal Reserve signalled a positive rate cut.
Brent crude futures were up 0.6%, or 49 cents, at $83.45 a barrel at 0415 GMT. U.S. West Texas Intermediate crude futures rose 0.7%, or 60 cents, to $79.53.
However, both contracts are down slightly for the week so far, with Brent and WTI down 0.1% and 0.5% respectively. Data from the Energy Information Administration showed that US gasoline inventories fell by 4.5 million barrels last week and distillate production fell by 4.1 million barrels. Both fell short of expectations, a sign of strong demand.
With the U.S. driving season just on the horizon, the market could get even tighter in coming weeks, ANZ Research said in a note.
In China, crude oil imports increased 5.1% in the first two months of 2024 from a year ago, and India’s oil consumption increased 5.7% on the year, amid strong factory activity in the world’s third-biggest oil importer and consumer.
When considering the additional day in February of this year, China’s oil imports rose 3.3% in the year, Capital Economics said in a note, in line with expectations for an increase in the year.
But that growth will be substantially lower than in 2023, when the end of zero-COVID restrictions led to a surge in activity in transport and travel, it added.
Providing further support for oil prices, Federal Reserve Chairman Jerome Powell said on Thursday that the US central bank is “not far” from being confident enough that inflation will fall to begin cutting interest rates.
Weakness in the U.S. dollar may have offered some support thus far, as Powell’s comments seem to fall short of the hawkishness that was initially expected, said Yeap Jun Rong, a market strategist at IG.
