ISLAMABAD
Crude oil prices bounced back on Friday after a four-day decline but are still on pace for a weekly loss.
As of 1425 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $0.44 (+0.54 percent) to reach $81.80 a barrel. Similarly, the West Texas Intermediate (WTI), the main oil benchmark for North America, went up by $0.59 (+0.77 percent) to $77.46 a barrel.
Earlier in the intra-day, oil traded near its lowest level in over three months as the market showed signs of weakness ahead of the US summer driving season. Brent crude traded near $81.38 per barrel. While WTI was at $76.86.
On the other hand, the price of Arab Light decreased by $0.06 (-0.07 percent) to reach $84.76 a barrel. Similarly, the price of Russian Sokol decreased by $0.01 (-0.01 percent) to $75.98 a barrel. On the other hand, the price for Opec Basket decreased by $0.31 (-0.37 percent) to $83.27 a barrel.
Oil prices have been stuck in a $3 range since their April highs as fears of a wider war in the Middle East ease and traders shift their focus back to basic supply and demand. Prices have struggled to break out this month with investors remaining cautious that higher-for-longer interest rates could slow the US economy and weigh on oil demand.
Minutes released on Wednesday from the Federal Reserve’s most recent policy meeting showed the US central bank discussed the potential to raise interest rates in the face of continued stubborn inflation.
“Various participants mentioned a willingness to tighten policy further should risks to inflation materialize in a way that such an action became appropriate,” the Fed minutes said. Higher interest rates boost borrowing costs, crunching funds that could boost economic growth and oil demand in the world’s largest oil consuming nation.
Traders are also worried about a buildup in global oil inventories after a mild winter in parts of the Northern Hemisphere. The US crude stocks rose by 1.8 million barrels last week, according to the Energy Information Administration, compared with an estimated draw of 2.5 million barrels. Supply curbs and buoyant demand could support prices in the longer term, however.
Meanwhile, Russia said it exceeded its OPEC+ production quota in April for “technical reasons” and will soon present to the Organization of the Petroleum Exporting Countries (OPEC) Secretariat its plan to compensate for the error, the Russian Energy Ministry said late on Wednesday. OPEC+ will meet on June 1 to decide on production cut levels.
