Oil prices edged up on Friday in line with a supply squeeze and hopes that China will increase stimulus for its economic growth. reuters informed of.
Brent crude rose 71 cents to $80.35 a barrel, while US West Texas Intermediate (WTI) crude gained 69 cents to $76.34 a barrel – more than $1 higher earlier in the session.
“The supply deficit that was narrowing in the second half of the year is now supported by tougher data,” said Commerzbank analysts.
The data showed that China and India’s crude oil imports from Russia reached an all-time high in June.
In line with shrinking discounting and payment problems, India is expected to face weak buying interest. Meanwhile, Russia earlier this month joined Saudi Arabia in cutting August production.
“Hence demand from China and India may shift more to other suppliers, which will push up oil prices,” analysts said.
Meanwhile, the Energy Information Administration (EIA) said on Wednesday that US crude stockpiles declined following a rise in crude imports and higher refinery utilisation.
“The supply shortfall is already being reflected in reserves,” said analysts at ANZ Bank.
In addition, investors have welcomed stimulus measures to improve China’s economy. Chinese officials on Friday unveiled plans to boost sales of automobiles and electronics.
The world’s second-biggest oil consumer indicated it was likely to miss the government’s 5% annual growth target.
Chinese officials also revealed plans to increase sales of automobiles and electronics on Friday.
“The announcement was short on detail, but the notion that China will buy more cars offers hope for oil investor bulls,” said PVM analyst John Evans.