OPEC demand optimism pushes oil prices up a little bit

11 Aug 2023 , 10:28 AM

Oil prices climbed somewhat on Friday as the OPEC producer group raised its forecast for global economic growth and expressed confidence that oil demand will remain strong in 2024.

Brent crude increased by 7 cents to settle at $86.47 a barrel, while U.S. West Texas Intermediate crude futures increased by 12 cents to $82.94 per barrel.

Since June, both benchmarks have been steadily rising, with West Texas Intermediate crude (WTI) trading at its highest level of the year on Thursday and Brent reaching its highest level since January.

The Organization of The Petroleum Exporting Countries announced on Thursday that it anticipates a 2.25 million barrels per day (bpd) increase in global oil demand in 2024, up from a 2.44 million bpd increase in 2023. From the previous month, neither forecast altered.

Oil consumption is anticipated to increase in 2024 due to ‘solid’ economic development and ongoing progress in China, it was said.

The U.S. consumer pricing data for July released on Thursday helped to boost market mood by fueling the notion that the Federal Reserve is nearing the conclusion of its aggressive rate hiking cycle.

Data this week revealed that China’s consumer sector entered deflation and factory gate prices continued to decrease in July, somewhat offsetting these favourable price drivers and raising concerns about gasoline demand in the second-largest economy in the world.

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