Oil posts weekly gain as global supplies tighten, volumes thin
Oil posted a fourth weekly gain amid lower summer trading volumes and tentative signs that global markets are tightening.
Russia has shown indications of paring crude exports as it belatedly honors a pact with Saudi Arabia and the OPEC alliance to help balance world markets. China, the world’s biggest crude importer, also has stepped up efforts to boost its flagging economic recovery.
This week, oil continued to follow the whims of broader market sentiment due to dwindling liquidity. Crude volumes often taper off during the summer holiday period, and traders have been reducing their exposure, sharply curbing open interest in West Texas Intermediate. The US benchmark settled near $77 a barrel on Friday.
Crude has ticked higher since late June on signs the market is tightening, but is still down for the year. Recent Chinese economic data signaled that the recovery remains lackluster and continues to drag on oil demand.
The Federal Reserve’s aggressive monetary policy also continues to weigh on the demand outlook, with the market pricing in another interest-rate hike this month. The odds for a further move higher went up slightly after initial jobless claims data released Thursday pointed to continued labor-market strength.
This story has been published from a wire agency feed without modifications to the text.
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Updated: 22 Jul 2023, 01:46 AM IST
Ganesh
http://ganesh@finplay.inFinance enthusiast, Mutual fund expert.