Crude oil futures settled higher on Friday after a report from the International Energy Agency (IEA) forecast strong demand for oil and tightening supplies in the market.
In a report released today, the IEA said global oil demand hit a record 103 million barrels per day in June and added that demand could scale another peak this month.
The IEA also said output cuts from Russia and Saudi Arabia could result in a sharp decline in inventories over the rest of this year and lift oil prices even higher.
The agency expects oil demand to grow by about 1 million barrels per day. However, that is down from its previous forecast by 150,000 barrels.
West Texas Intermediate Crude oil futures for September ended higher by $0.37 at $83.19 a barrel.
Brent crude futures were up $0.30 or about 0.35% at $86.70 a barrel a little while ago.
WTI and Brent crude futures, both recorded their seventh straight weekly uptick.
The market also noted the OPEC’s report released on Thursday which said global oil demand will likely rise by 2.25 million barrels per day next year, compared with growth of 2.44 million barrels per day in 2023.
A report from Baker Hughes showed the total number of active drilling rigs in the U.S. fell by 5 this week to 654 this week. While the number of oil rigs stayed the same this week at 525, the number of gas rigs dropped by 5 to 123, the data said.
Edward Moya, Senior Market Analyst at OANDA, says, “Crude prices are resuming their bullish ascent as energy traders remain overly confident the oil market will remain tight. The oil rally is poise for a seventh straight week of gains and it doesn’t seem like exhaustion is settling in yet. When the market gets complacent, sometimes that is when you get a decent pullback, but for now it seems any oil dips will be bought.”
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