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Oil rose for the third day on expectations of a pick-up in fuel demand

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Oil prices rose for a third day on Thursday on hopes that fuel demand will pick up later this year, particularly in the United States, Europe and China; At the same time, major producers are maintaining supply discipline.

Brent crude futures were up 49 cents, or 0.7 per cent, at $71.84 a barrel by 0233 GMT, the highest since September 2019. The international benchmark rose 1.6 per cent on Wednesday.

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US West Texas Intermediate crude futures rose 44 cents, or 0.6 per cent, to $69.27 a barrel. Prices earlier rose to $69.32, the highest since October 2018, after gaining 1.5 percent in the previous session.

The consensus among market forecasters, including the Organization of the Petroleum Exporting Countries and its allies known as OPEC+, is that demand for oil will exceed supply in the second half of 2021, which has driven the recent run in prices. .

OPEC+ data shows oil demand will be 99.8 million barrels per day (bpd) versus supply by 97.5 million bpd by the end of the year.

The rebalancing will be led this summer by resurgent demand in the United States, the world’s largest oil user by vehicle consumption, along with rising fuel needs in China, the world’s second largest oil consumer, and the UK as it Comes out of his covid. -19 lockdown.

“The US driving season is a period that sees higher-than-normal fuel consumption. UK traffic is now sitting well above pre-pandemic levels,” said CBA commodity analyst Vivek Dharsaid in a note. We continue to see an improvement in oil demand led by China.”

OPEC+ on Tuesday agreed to continue with plans to ease supply restrictions through July.

The OPEC+ meeting lasted 20 minutes, the fastest in the group’s history, suggesting strong compliance among members and a belief that demand will recover once the Covid-19 pandemic signals an end.

The slowdown in talks between the US and Iran over Iran’s nuclear program has also dampened hopes of a return to Iranian oil supplies this year.

The EU envoy coordinating the discussions said he believed a deal would be reached in the next round of talks starting next week, though other diplomats cautioned that difficulties remained.

“The current talks in Vienna to revive the 2015 nuclear deal, which would lift US sanctions on Iran, are now unlikely to find a solution,” CB’AS Dhar said.

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