Oil climbs, fuelled by tighter supplies, China stimulus

Oil climbs, fuelled by tighter supplies, China stimulus

Oil prices increased on Friday due to signs of tightening supplies and economic stimulus in China, which is slowly recovering. Brent futures rose by $1.02 to $80.66 a barrel, while U.S. West Texas Intermediate (WTI) crude climbed $1 to $76.65 a barrel. Commerzbank analysts noted that recent data showed record-high imports of crude oil from Russia by China and India in June, supporting the anticipated supply deficit in the second half of the year.

However, the analysts also mentioned that buying interest from India may weaken due to narrowing discounts and payment issues. Additionally, Russia joined Saudi Arabia in reducing output for August. As a result, the analysts suggested that demand from China and India could shift towards other suppliers, leading to higher oil prices.

In the U.S., crude inventories have fallen, supported by increased crude exports and higher refinery utilization, according to the Energy Information Administration (EIA). ANZ Bank analysts highlighted that this tightening supply situation is already reflected in inventories.

Investors responded positively to stimulus measures aimed at revitalizing China’s sluggish economy. The latest figures indicate that China’s second-quarter gross domestic product growth rate is likely to fall short of the government’s 5% annual target. In response, Chinese authorities unveiled plans to boost sales of automobiles and electronics. PVM analyst John Evans expressed optimism, stating that the announcement, although lacking details, raises hopes for oil investors.

This article was reported by Natalie Grover in London, with additional reporting by Arathy Somasekhar in Houston and Andrew Hayley in Beijing. It was edited by Louise Heavens and David Holmes. The article adheres to The Thomson RushHourDaily Trust Principles.

About News Team

Hi, I'm Alex Perez, an experienced writer with a focus on lifestyle and culture news. From food and fashion to travel and entertainment, I love exploring the latest trends and sharing my insights with readers. I also have a strong interest in world news and business, and enjoy covering breaking stories and events.

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