ISLAMABAD
Crude oil prices edged lower as dollar remained strong on Friday despite the International Energy Agency (IEA) reported that global oil demand will hit new highs and is expected to average 102.2 million barrels per day (bpd) this year.
As of 1340 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, shed $0.06 (-0.07 percent) to reach $86.34 a barrel.
The West Texas Intermediate (WTI), the main oil benchmark for North America, went down by $0.13 (-0.16 percent) to $82.69 a barrel. The US benchmark touched $83.91 in the previous session, which has been its highest level since November 2022.
Both benchmarks have been on a sustained rally since June, and WTI traded at its highest this year and Brent hit its highest price since January on Thursday.
However, the price of Russian Sokol increased by $1.42 (+1.77 percent) to $81.74. Arab Light prices witnessed an increase of $1.19 (+1.32 percent) to reach $91.51 a barrel. On the other hand, the price for Opec Basket increased by $0.59 (+0.67 percent) to $88.20. The OPEC Reference Basket of Crudes (ORB) is made up of Saharan Blend, Girassol, Djeno, Zafiro, Rabi Light, Iran Heavy, Basra Light, Kuwait Export, Es Sider, Bonny Light, Arab Light, Murban and Merey.
The benchmark 10-year US Treasury bond yield stayed in the positive territory above 4.1 percent after July Producer Price Index (PPI) data made it difficult for crude oil price to hold its ground. The US consumers paid prices that were 3.2 percent higher in July than a year earlier. That’s a touch milder than economists expected and down sharply from last summer’s peak above 9 percent. The readings bolstered hopes that the Federal Reserve’s campaign to grind down inflation is making progress.
On the other hand, global oil demand will hit new highs and is expected to average 102.2 million barrels per day (bpd) this year, driven by summer air travel, strong Chinese petrochemical activity, and higher oil use in power generation, the IEA said on Friday.
World oil demand is set to grow by 2.2 million bpd this year, with China accounting for more than 70% of growth, the agency said in its closely-watched Oil Market Report (OMR) for August. The growth estimate is unchanged from last month’s report, in which the IEA cut its global oil demand growth forecast for the first time this year, due to persistent economic headwinds.
