Oil Rises on Broader Risk On Sentiment

by Bloomberg | Julia Fanzeres
click here to read this article at Rigzone.com via Bloomberg
*this article was not written by Roseland Oil & Gas

Oil rose as risk-on sentiment in broader markets cajoled traders back into crude, overpowering the International Energy Agency’s forecast for slowing demand growth. 

West Texas Intermediate gained 1.8% to settle above $78 a barrel, erasing Wednesday’s decline, as equities advanced and the dollar fell for a second day. The weakening US currency, which makes the commodity cheaper for overseas buyers, encouraged money managers to buy the dip, traders said. 

Earlier in the session, prices fell after the Paris-based IEA said the crude market could be in surplus all year, pointing to expanding non-OPEC+ supplies and a slowdown in consumption. Even after the advance, crude remains in the $10 range it has been stuck in this year.

Tensions in the Middle East and efforts by OPEC+ to curb production have been countered by robust supplies from drillers outside the cartel and concerns worldwide demand growth will slow over 2024. Another headwind has come from expectations that US interest rates could remain higher for longer as inflation persists.

Still, market metrics continue to signal tight conditions, with timespreads for both major benchmarks holding in a bullish, backwardated structure despite shrinking slightly. Refiners’ profits from making fuels like diesel and gasoline also remain elevated.

Prices:

• WTI for March delivery rose $1.39 to settle at $78.03 a barrel in New York.
• Brent for April settlement gained $1.26 to close at $82.86.

by Bloomberg | Julia Fanzeres
click here to read this article at Rigzone.com via Bloomberg
*this article was not written by Roseland Oil & Gas