Oil prices rose in the Friday session after the International Energy Agency expected record global demand and shrinking supplies, which pushed oil to achieve gains for the seventh consecutive week, in the longest streak of gains since 2022.
Brent crude futures rose 41 cents, or 0.5%, to settle at $86.81 a barrel, while US West Texas Intermediate crude futures rose 37 cents, or 0.5%, to settle at $83.19 a barrel.
Brent crude recorded a weekly gain of 0.66%, while US “NYMEX” crude rose by 0.45% during the week.
The International Energy Agency said that global oil demand reached a record level of 103 million barrels per day in June and could reach another peak this month, according to Reuters.
At the same time, the decision by Saudi Arabia and Russia to extend production cuts caused a sharp decline in inventories for the remainder of 2023, which the International Energy Agency said could lead to higher oil prices further.
The Organization of the Petroleum Exporting Countries (OPEC) said on Thursday that it expects global oil demand to rise by 2.44 million barrels per day this year, adding that oil market prospects look good in the second half of the year.
Investor sentiment was boosted by US economic data released last week, which raised speculation that the Federal Reserve (the US central bank) is close to ending the interest rate hike cycle.
“OANDA” analyst Craig Erlam said the supply cuts and improved economic outlook have sent optimism to oil investors. However, he pointed to signs of diminishing momentum after a sustained rally in prices. Yesterday, Brent crude recorded its highest level since January, the day after the US West Texas Intermediate crude recorded its highest level this year.
The last time the price of Brent crude rose for 7 consecutive weeks was in the period from January to February 2022 before the Russian invasion of Ukraine.
Unstable economic data coming out of China affected sentiment.
And while customs data showed crude oil imports rising year-on-year, China’s total exports fell 14.5% in July, with monthly crude imports falling from near-record highs in June to their lowest since January.