Oil Prices Rise Amid Data from US and China
In a week marked by data releases from the US and China, the world’s top two consumers of crude oil, prices have seen an uptick, with uncertainty over the Gaza conflict also playing a role in supporting the market. According to Reuters, oil prices climbed on Friday, heading towards a weekly gain.
Positive Indicators from US and China
The rise in oil prices comes as US crude inventories fall due to increased refinery activity. Additionally, China reported higher oil imports in April compared to last year, indicating improving trade conditions. These positive indicators have contributed to the upward momentum in the oil market.
Geopolitical Tensions and Supply Concerns
Despite efforts to negotiate a ceasefire between Israel and Hamas, tensions remain high, raising concerns about potential disruptions in Middle East oil supply. The ongoing conflict in Gaza has the potential to draw in other regional players, such as Iran, a key supporter of Hamas.
Market Outlook and Price Projections
While demand from China continues to show strength, analysts predict that oil prices may ease in the coming months. Citi analysts forecast Brent crude to average $86 a barrel in the second quarter of 2024, dropping to $74 in the third quarter. This projection is based on expectations of looser supply and demand dynamics as global oil demand growth moderates.