LONDON: Oil prices rose on Friday and were headed for a gain of about 3 percent for the week, driven by tight US supply and expectations of strong fuel demand in China during the Golden Week holiday, according to Reuters.
US West Texas Intermediate crude was up $1.31, or 1.43 percent, to $93.02 per barrel at 3:08 p.m. Saudi time.
Front-month Brent November futures were up 88 cents, or 0.92 percent, at $96.26 per barrel ahead of the contract’s expiry later in the day. The more-liquid Brent December contract was up 97 cents, or 1.04 percent, at $94.07 per barrel.
A backdrop of tight supplies in the US provided further price support, with storage at Cushing, Oklahoma, the delivery point for crude futures, already at its lowest since July 2022.
“Any additional decline would threaten to bring them down to a critical level, which could make further withdrawals difficult,” said Commerzbank analyst Carsten Fritsch.
China’s fuel demand was set to firm as the week-long Golden Week holiday began on Friday.
“(An) increase in international travel during the Golden Week holiday is boosting Chinese oil demand,” ANZ analysts said in a client note.
Domestic travel is also expected to boost demand, with data from flight app Umetrip showing the average number of daily flights booked is a fifth higher than for Golden Week in 2019, before COVID.
Meanwhile, inflation in the euro zone fell to a two-year low of 4.3 percent in September, the latest Eurostat flash reading showed, suggesting the European Central Bank’s policy of steady interest rate hikes was taking effect.
Russia is considering introducing fuel export quotas if the current export ban is not effective in bringing down domestic prices.
Russian gasoline and diesel exchange prices on the St. Petersburg International Mercantile Exchange fell slightly on Friday.
Brent is forecast to average $89.85 a barrel in the fourth quarter, and $86.45 in 2024, according to a survey of 42 economists compiled by Reuters on Friday.
