As traders waited for the Organization of Petroleum Exporting Countries and its allies (OPEC+) to decide on supply agreements for the second quarter and considered new economic data from the US, Europe, and China, oil prices increased by 2% in the previous session and registered weekly gains.
May Brent futures ended the day $1.64 higher, or 2%, at $83.55 per barrel. At $83.62 a barrel, the April Brent futures contract ended on February 29. US West Texas Intermediate (WTI) increased to $79.97 per barrel in April, up $1.71, or 2.19 percent.
What’s driving crude oil prices?
-In the first week of March, a decision regarding the extension of OPEC+ cutbacks is anticipated, including announcements from individual nations.
Analysts believe that adhering to the voluntary output cuts through the end of the year would send a strong signal and be viewed as positively indicative of pricing.
-The market was also supported on Friday by strong anticipation that Saudi Arabia would maintain the term prices of the petroleum it sells to Asian clients at levels that are mostly unchanged from March.
-In its widely watched report on Friday, energy services company Baker Hughes, opens new tab, stated that US energy companies increased the number of oil and natural gas rigs for a second consecutive week.
-An official survey revealed that, in terms of demand, Chinese industrial activity declined in February for the fifth consecutive month. According to Eurostat, the rate of inflation in the euro zone decreased in February; nonetheless, the headline figure and core inflation, which excludes volatile costs for fuel and food, fell short of analysts’ forecasts.
-Reiterating market bets for a June interest rate decrease, the US personal consumption expenditures (PCE) index showed January inflation in line with economists’ estimates on Thursday, supporting prices.
Future trajectory
)
Crude oil was extremely volatile, retreating from its highs after the dollar index increased. The US economic data that was announced on Thursday mainly met forecasts, which reduced worries about rising inflation.
‘’Crude oil prices managed to secure gains for the second consecutive month in February. Prices are anticipated to continue their volatile trajectory. Crude oil is supported at $77.30–$76.70, with resistance observed at $78.90-$79.60. In terms of the INR, crude oil finds support at ₹6,440-6,350, while resistance lies at ₹6,590-6,680,” said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.
