Oil edged higher, aided by positive quarter-end sentiment across markets, after a recent rally that propelled prices as high as $95.
(Bloomberg) — Oil edged higher, aided by positive quarter-end sentiment across markets, after a recent rally that propelled prices as high as $95.
West Texas Intermediate ekeed out a modest gain after a rollercoaster session on Thursday, when it rose above $95 a barrel before closing down 2.1%. Futures are headed for their biggest quarterly gain since March 2022 on Saudi-led OPEC+ supply cuts and critically low stockpiles at the Cushing hub in the US.
Many of this week’s most significant market moves have come away from headline prices. Key timespreads have exploded higher as fears about the availability of US supplies boost crude prices globally. Meanwhile, gasoline’s premium over crude in the US has plunged in a potential sign that higher crude prices are starting to impinge on margins.
Even with traders casting a wary eye on the demand outlook, there is little to obstruct crude’s march toward $100 a barrel as OPEC forecasts a supply deficit at 3 million barrels a day next quarter and stockpiles at the largest US storage hub have dwindled to near-critical levels.
“Oil for short-term delivery is being traded at a significant premium, which is an indication of tight supply,” Commzerbank AG analysts including Barbara Lambrecht said in a report. “At the same time, demand for oil is continuing to grow. This is tightening the oil market, as evidenced by declining inventories.”
China’s Golden Week holidays, which run through next Friday, are expected to boost consumption as more people fly domestically and on international routes.
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