London, July 5, 2024 – (Reuters) – Oil prices edged lower on Friday but were trading near their highest since late April and on track for a fourth straight week of gains, driven by hopes of strong summer fuel demand and some supply concerns.
Brent crude futures dipped 22 cents, or 0.25%, to $87.21 a barrel by 1105 GMT. U.S. West Texas Intermediate (WTI) crude futures were down 9 cents, or 0.11%, at $83.79.
With the U.S. market shut on Thursday for the Independence Day holiday, trading was thin and there was no settlement for WTI, but prices have risen this week on strong summer demand expectations in the United States.
“Those who have kept faith that the driving season would eventually come are glowing in prescience and the many calls of a much better path for bulls in the third quarter seem to hold true at present,” said PVM oil analyst John Evans.
The U.S. Energy Information Administration (EIA) reported a huge 12.2-million-barrel inventories draw last week, compared with analyst expectations for a draw of 700,000 barrels.
U.S. data on Wednesday showed that first-time applications for unemployment benefits increased last week while jobless numbers also rose, which analysts said could hasten interest rate cuts by the Federal Reserves and support oil markets.
On the supply side, Reuters reported on Thursday that Russian oil producers Rosneft and Lukoil will make sharp cuts to oil exports from the Black Sea port of Novorossiisk in July.
“This is a positive signal for the forecast supply deficit over third quarter, but given Russia’s poor adherence to production quotas in the past, it will take some time to see if this will be delivered,” said Panmure Liberum analyst Ashley Kelty.
Russian gasoline production is expected to rise by between 15,000 and 20,000 metric tons in the last third of July as two refineries restart operations, the energy ministry said on Friday.
Meanwhile, Saudi Arabia’s Saudi Aramco has cut prices for the flagship Arab Light crude it will sell to Asia in August to $1.80 a barrel above the Oman/Dubai average, underscoring pressure faced by OPEC producers as non-OPEC supply grows.
Traders were also tracking the war in Gaza and elections in France and Britain, analysts said. (Reuters)
