Oil prices increased this week, backed by an optimistic global demand outlook and an economic recovery in the world’s biggest oil importer, China.
International benchmark Brent crude traded at $81.65 per barrel at 2 p.m. local time (1100 GMT) on Friday, rising by about 1.3% relative to the closing price of $80.61 a barrel on Friday last week.
West Texas Intermediate (WTI), the American benchmark, traded at $76.73 a barrel at the same time on Friday, with an increase of around 1.10% from last Friday’s session that closed at $75.89 per barrel.
Both benchmarks traded high on Monday, with buoyant oil prices ahead of the much-expected OPEC+ meeting over expectations that the group will continue its current output cuts through January.
Market players expect OPEC’s largest producer, Saudi Arabia, to extend its production cuts of 1 million barrels per day (bpd) for at least another month.
Positive economic activity in the world’s second-largest oil consumer, China, also aided price rises during the week. Recent data revealed that the Chinese economy has recovered from the wounds of the COVID pandemic.
The OPEC group also said in its latest monthly report that global demand is expected to increase in 2024 with solid economic growth in China, resulting in greater demand and further oil consumption.
Prices declined mid-week with uncertainties over a delay to the OPEC+ meeting. Major oil producers at the meeting are expected to decide whether to continue, reduce, or increase the current output cuts, accelerating market volatility.
The group announced late Wednesday that the meeting slated for Sunday will be postponed to Thursday, Nov. 30.
Prices continued to fall through Thursday, with data indicating a demand decline in the US, the world’s largest oil consumer.
US crude oil inventories increased by around 8.7 million barrels last week, according to the US Energy Information Administration late on Wednesday, against the market expectation of a 1.46 million-barrel inventory build.
Overall, supply uncertainty in the market limited price increases week on week.
