Written by Natalie Glover
LONDON (Reuters) – Global benchmark Brent crude oil prices hovered above $84 a barrel on Friday, after this week’s data showed rising demand from the world’s two biggest oil users, the United States and China. However, the escalating conflict in the Middle East also provided support.
At 0956 GMT, Brent futures were up 51 cents at $84.39 a barrel. U.S. West Texas Intermediate crude rose 57 cents to $79.83.
The decline in U.S. crude inventories due to increased refinery operations was consistent with data released Thursday showing China’s crude oil imports rose in April from a year earlier on signs of improving trade activity.
China’s imports and exports decreased last month, but returned to growth in April.
“Commodity markets will remain well supported by continued signs of strength in Chinese demand,” analysts at ANZ Research said in a note.
In Europe, a Ukrainian drone strike set fire to a refinery in Russia’s Kaluga region, RIA state news agency reported on Friday, the latest salvo from Kiev in a series of retaliatory attacks on energy infrastructure.
Meanwhile, conflicts in the Middle East continue after Israeli forces shelled areas in the southern Gaza city of Rafah on Thursday, after the latest round of negotiations to halt hostilities in Gaza failed, according to Palestinian residents. There is.
As the conflict intensifies, the possibility of a broader conflagration increases in the region, particularly in Iran, a major supporter of the Palestinian organization Hamas and a major oil producer.
“The groundwork for Israel’s intervention in Rafah and escalating tensions on the northern border are reminders that geopolitical risks are likely to persist through at least the second quarter of 2024,” Citi analysts said in a note. .
Still, the bank said Brent crude prices averaged $86 per barrel in the second quarter and $74 per barrel in the third quarter, amid signs that global oil demand growth “appears to be slowing.” , we expect it to ease until 2024.
(Reporting by Natalie Glover in London, Katya Golubkova in Tokyo and Sudarshan Varadhan in Singapore; Editing by Stephen Coates and Mark Potter)
