Oil prices climb on weak dollar, supply concerns
By Florence Tan and Jeslyn Lerh
SINGAPORE (Reuters) -Oil costs climbed on Monday as a weaker greenback and provide issues forward of the European Union embargo on Russian oil in December offset fears of a world recession that would dampen gasoline demand.
Brent crude futures rose 60 cents, or 0.7%, to $91.95 a barrel by 0330 GMT after settling up 0.5% on Friday. U.S. West Texas Intermediate crude was at $85.50 a barrel, up 39 cents, or 0.5%. The front-month contract expires on Tuesday.
Each contracts, which slid greater than 1% final week on issues that one other rate of interest hike by the Federal Reserves might sluggish international progress, have been supported by a weaker greenback which got here off multi-year highs. A weaker U.S. greenback makes dollar-denominated commodities inexpensive for holders of different currencies.
“The market nonetheless has the beginning of European sanctions on Russian oil hanging over it. As provide is disrupted in early December, the market is unlikely to see any fast response from U.S. producers,” ANZ analysts mentioned Monday.
Extra provide disruptions stay a danger, whereas easing COVID-19 restrictions in China might additionally present some optimism, the analysts mentioned.
China has began easing COVID curbs in Chengdu, a southwestern metropolis of greater than 21 million folks, which has helped to assuage issues about demand on the earth’s No. 2 vitality shopper. China’s gasoline and diesel exports additionally rebounded, easing excessive native inventories, after Beijing issued contemporary quotas.
Regardless of questions on the way forward for the world financial system, Kuwait Petroleum Company’s (KPC) chief govt mentioned on Sunday its clients nonetheless demand the identical volumes with no change.
The Gulf state at present produces greater than 2.8 million barrels per day of oil in accordance with its OPEC quota.
Elsewhere, oil loading and exporting operations from Iraq’s Basrah oil terminal are again to their regular charges on Saturday, Basrah Oil Firm mentioned, a day after being halted attributable to a spillage which has now been contained.
In Nigeria, Shell’s 200,000 barrels per day Bonga deep water storage and offloading vessel is scheduled for upkeep in October, a spokesperson mentioned on Sunday.
Signalling extra provides from america, U.S. vitality companies added oil and pure fuel rigs for the primary time in three weeks final week.
The oil and fuel rig rely, an early indicator of future output, rose 4 to 763 within the week to Sept. 16, its highest since August, vitality providers agency Baker Hughes Co mentioned on Friday.
(Reporting by Florence Tan and Jeslyn Lerh; Enhancing by Lincoln Feast & Shri Navaratnam)
