Oil prices up on tighter supply, lower US inflation
2023.07.13 21:30
© Reuters. FILE PHOTO: A Marathon Oil well site is seen, as oil and gas activity dips in the Eagle Ford Shale oil field due to the coronavirus disease (COVID-19) pandemic and the drop in demand for oil globally, in Texas, U.S., May 18, 2020. Picture taken May 18, 20
By Katya Golubkova
TOKYO (Reuters) – Oil prices rose on Friday on support from tighter supply amid issues in Libya and Nigeria and easing U.S. inflation, which markets hope may bring an end to interest rate hikes in the world’s biggest economy.
futures rose 27 cents, or 0.3%, to $81.63 per barrel at 0028 GMT. U.S. West Texas Intermediate crude futures rose 35 cents, or 0.5%, to $77.24.
U.S. consumer prices rose modestly in June at the smallest annual increase rate in more than two years as inflation continued to subside. Producer prices also barely rose in June, and the annual increase was the smallest in nearly three years.
Both indicators gave markets a hope the U.S. Federal Reserve could be closer to ending its fastest monetary policy tightening campaign since the 1980s.
“Positive risks sentiment swept over markets, spurred by more data showing a deceleration in U.S. price pressures, raising hopes that the Fed may be ‘one and done’ on additional rate hikes,” ANZ Research said in a client note on Friday.
On Thursday, a number of oil fields in Libya were shut down in a protest by a local tribe against a kidnapping of a former minister. Separately, Shell (LON:) has suspended loadings of Nigeria’s Forcados due to a potential leak at a terminal.
Protests in Libya alone could take more than 250,000 barrels of oil per day from the market, ANZ Research said.
“This comes amid signs that recent cuts to supply from Saudi Arabia and Russia are biting,” it added.
Saudi Arabia and Russia, the world’s biggest oil exporters, this month agreed to deepen oil cuts in place since November last year, providing further support to crude prices.
