Oil rises in price amid expectations of US fuel demand ahead of OPEC+ meeting
Kyiv • UNN
Oil prices rose in Asian trading on Tuesday, supported by expectations of strong demand for fuel in the US during the summer car season and ahead of the OPEC+ meeting on June 2, which is expected to extend production cuts.
Oil prices rose in Asian trading on Tuesday, continuing to rise compared to the previous session, driven by expectations of high demand for fuel in the US in the summer ahead of OPEC+'s decision on production at a meeting to be held on June 2, UNN writes with reference to Reuters.
Details
July futures for Brent crude rose 21 cents to $83.31 per barrel by 03:29 GMT (06:29 Kyiv time). More active August futures rose 21 cents to $83.09.
July futures for US West Texas Intermediate (WTI) were trading at $78.90 per barrel, up $1.18, or 1.52%, from the close on Friday.
Oil prices rose by more than 1% on Monday amid subdued trading due to public holidays in the UK and the US after a "gloomy" week, which was driven by the forecast of interest rates in the US in the context of steady inflation.
Expectations of high demand for fuel with the start of the summer travel and vacation season in the US have supported prices, some analysts say.
Despite the general belief that higher interest rates for a longer period of time could lead to weak oil demand growth, "real-time mobility data indicate that oil demand growth is still generally healthy," said UBS analyst Giovanni Staunovo in a note to clients.
Meanwhile, all eyes will be on the upcoming OPEC+ online meeting on June 2, where traders and analysts expect production cuts to remain in place and drive prices higher.
"We expect oil prices to rise in the coming days due to the expected extension of voluntary production cuts by oil producers and the growing prospects for easing US monetary policy," said Satoru Yoshida, commodities analyst at Rakuten Securities.
Yoshida added that the start of the car season in the US will also support prices.
Earlier, three sources from the OPEC+ countries said that the voluntary production cut of 2.2 million barrels per day could be extended in the second half of the year.
A slight decline in the US dollar also supported the markets.
"Crude oil prices, having maintained the positive momentum of the past two sessions, seem to have stabilized on Tuesday morning as the pullback in the US dollar also contributes to the optimistic outlook," said Priyanka Sachdeva, senior market analyst at Phillip Nova.
