Quantum Commodity Intelligence – Crude oil futures in European hours Friday were little changed, as benchmarks held onto modest weekly gains after facing mixed signals over the past few days.
Front-month Jul24 ICE Brent futures were trading at $83.21/b (1410 GMT), compared to Thursday’s settlement of $83.27/b.
At the same time Jun24 NYMEX WTI was trading at $79.16/b versus Thursday’s settlement of $79.23/b.
The OPEC monthly report gave prices a brief lift earlier in the week after the producer group stuck with its upbeat outlook on 2024 demand. It expects demand growth at 2.25 million bpd for this year and another 1.85 million growth in 2025, supported by firm global economic growth.
However, the modest price rebound largely stalled when the OPEC outlook was countered by the IEA trimming its own growth forecast for this year to 1.1 million bpd.
The US economy also sent mixed signals with Reserve Chair Jerome Powell effectively stamping out any lingering hopes of a June rate cut, saying that inflation is dropping at a slower pace than expected.
But April’s CPI figures revealed an increase of 0.3%, slightly less than expected, while on an annual basis inflation increased 3.4%, raising prospects for a rate cut in the third quarter.
“Cooler-than-expected US inflation has boosted expectations of a September rate cut, lowering the dollar and making oil more affordable for holders of other currencies,” commented City Index analyst Fiona Cincotta.
“However, the upside could be limited following the IEA’s downward revision of oil demand forecasts made earlier in the week.”
Last Friday, Jul24 Brent futures closed at $82.79/b, while Jun24 WTI settled at $78.26/b while both benchmarks had tested near two-month lows earlier this week.
