The oil continues its bullish streak this Friday, driven by renewed concern around global supply after the Russian ban to export fuel. This measure countered demand-related fears stoked by the macroeconomic headwinds and high interest rates.
Brent futures show an increase of 1.1% to US$94.36 per barrel. Meanwhile, the futures of West Texas Intermediate in the United States (WTI) advance 1.6% and is trading at US$91.98.
Both benchmarks pointed to a slight weekly drop after having recorded an increase of more than 10% in the previous three weeks. This situation was due to growing concern about global supply shortages, as the Organization of the Petroleum Exporting Countries and its allies (OPEC+) maintained production cuts.
Oil: what can happen in the coming days
Toshitaka Tazawaof Fujitomi Securities Co Ltd, said: “Trading remained choppy amid a tug-of-war between supply fears, accentuated by the Russian ban on fuel exportsand concerns about slowing demand due to tighter monetary policies in the United States and Europe.”
In a relevant development, the Russian company Transneft suspended diesel deliveries to the key terminals of Primorsk and Novorossiysk in the Baltic and Black Seas on Fridayaccording to the state agency Tass.
Russia had implemented a temporary ban on gasoline and diesel exports to all countries outside a circle of four former Soviet states, effective immediately, cwith the objective of stabilizing the national fuel marketas reported by the government on Thursday.
However, despite these developments, Macroeconomic headwinds continued to put pressure on oil demand sentiment. Commerzbank analysts indicated in a note that “it is demand signals that may influence oil prices most in the short term.”
On the other hand, HSBC raised its Brent price forecasts on Friday, putting them at $90 a barrel for the fourth quarter and $82.50 for 2024. This was due to record demand from China and the forecast that Saudi Arabia’s voluntary production cuts would remain in place until the second quarter of 2024.
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