Oil Steadies On US Trade Deal Optimism, Diesel Tightness
Crude has remained in a holding pattern this month but is down for the year as increased supply from OPEC+ adds to concerns over a looming glut.
Oil was steady on optimism over US trade talks ahead of a key deadline next week, and as tightness in diesel markets boosts sentiment.
Brent crude was above $69 a barrel after adding 1% on Thursday, while West Texas Intermediate traded near $66. Indian Commerce Minister Piyush Goyal said he was confident that his country could reach an agreement with the US before the Aug. 1 target date, while Brazil and Mexico looked to broaden trade ties.
Meanwhile, diesel prices have soared, leading to steep premiums for niche crude grades that yield more of the fuel and injecting much-needed strength into a bogged-down oil market. The latest European Union measures restricting Russian energy imports have also added to the tightness, according to TotalEnergies SE.
Crude has remained in a holding pattern this month, but is down for the year as increased supply from OPEC+ adds to concerns over a looming glut. The group will next meet on Aug. 3 to decide on production levels. On Thursday one member, Venezuela, was given a production reprieve by a US decision to let Chevron resume pumping oil in the country.
“The only strength right now is coming from the diesel markets,” said Florence Schmit, an analyst at Rabobank. “The US government’s backpaddling on curtailing Venezuelan oil supplies will only add to a relatively loose supply balance later this year.”
Prices
Brent for September settlement rose 0.2% to $69.32 a barrel at 10:35 a.m. in London.
WTI for September delivery advanced 0.2% to $66.17 a barrel.
