Oil prices continued to rise today, Tuesday, July 25 (2023), amid indications of scarce supplies, and pledges by the Chinese authorities to support the economy to greater degrees, which contributed to raising sentiment in the markets.
Crude prices had achieved a significant rise for the first time in weeks, as it exceeded the barrier of $82 a barrel, to get out of the 70 region that it needed for many months, according to a report published by Reuters, which was reviewed by the specialized energy platform.
And oil prices recorded the highest level in 3 months, at the end of trading yesterday, Monday, July 24, amid expectations from traders of further increases in interest rates from the US and European central banks, but the decline in supplies after the voluntary cut and hopes for the Chinese economy supported the price of a barrel.
Oil prices now
By 7:00 AM GMT (10:00 AM Mecca time), Brent crude futures for September 2023 delivery were up 0.25%, to $82.96 a barrel.
Meanwhile, US West Texas Intermediate crude futures rose 0.3%, to $78.97, according to figures seen by the specialized energy platform.
And the benchmark Brent crude and West Texas Intermediate, the US mediator, rose at the end of yesterday’s transactions to their highest closing since last April 2023, in addition to their rise for 4 consecutive weeks, with the expectation of tightening supplies due to the cuts of OPEC + countries.
China – which is the second largest economy in the world and the second largest oil consumer in the world as well – is witnessing pledges by political leaders to provide support for the economy, especially after the end of the Corona pandemic crisis there, and to focus on domestic demand.
Oil price analysis
Wanda analyst Edward Moya said energy traders are rising in confidence that global central bank tightening of interest rates will end soon, which should provide some support to global growth.
The bearish data in the euro area and the United States indicates a severe weakness facing the global economy, as a poll showed that the euro area is witnessing a contraction in business activity to a greater extent than expected in July.
In the United States, business activity slowed to a five-month low in July, affected by slower growth in the services sector, according to survey data seen by the specialized energy platform.
It is noteworthy that investors had expected a quarter-point increase in interest rates by the US Federal Reserve and the European Central Bank during the current week, so the focus will be on the leaders of the two banks regarding interest rates.
US crude inventories data is expected to be released later today, as 4 analysts polled by Reuters estimate – on average – that crude stocks fell by about 2 million barrels in the week ending July 21.
Leave a Reply