Oil points to weekly gains after OPEC+ supply cuts

Oil advanced around 1% on Friday and headed for a second straight weekly gain, following OPEC+’s decision to make its biggest supply cut since 2020 despite recession concerns and interest rate hikes. interest.

The decrease announced by the Organization of Petroleum Exporting Countries and its allies, including Russia, known as OPEC+, comes ahead of a European Union embargo on Russian oil and will cut supply in an already tight market.

crude oil futures Brent They were up 87 cents, or 0.9%, at $95.29 a barrel by 1110 GMT. Meanwhile, the oil WTI The United States rose 98 cents, or 1-1%, to $89.43 a barrel.

“Among the key effects of OPEC’s latest cut is a likely return of oil to the $100 level,” said Stephen Brennock of brokerage PVM. “However, gains will be limited by growing economic headwinds,” he added.

Both benchmarks were headed for a second weekly gain and Brent topped an 8% gain this week. The North Sea index remains well below its all-time high of $147 a barrel hit in March after Russia invaded Ukraine.

A drop in the dollar index ahead of Friday’s US employment report also provided some support for oil, although given the commitment of the Federal Reserve to combat inflation, strategists believe the trend will not last.

Investors are eyeing the US non-farm payrolls report due later on Friday for clues as to how much longer US interest rates will continue to rise.

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