Oil prices rose early on Friday, supported by a general bullish market sentiment after US and Chinese presidents held a phone call to discuss various issues of strategic interest.
At 9:32 a.m. EDT on Friday, WTI Crude rose 2.48% to $ 69.80. Brent Crude had risen 2.25% to trade above $ 73 a barrel, at $ 73.02.
Oil and stock markets jumped today after U.S. President Joe Biden and Chinese President Xi Jinping spoke on Thursday and “had a broad strategic debate in which they discussed areas where our interests and areas converge. in which our interests, values and perspectives differ “. as the White House said.
Markets expect the call to lead to more trade between the world’s two largest economies, which is expected to increase oil demand.
The continued major disruption in oil production in the U.S. Gulf of Mexico following Hurricane Ida also supported oil prices on Friday.
As of Thursday, up to 1.4 million barrels a day (bpd), or 76.48 percent of oil production in the Gulf of Mexico, remained offline, the Security Bureau data showed. and Environmental Application (BSEE).
Crude oil, gasoline and distillate inventory extracts reported by the EIA on Thursday also boosted oil prices on Friday, although this week’s inventory report was distorted by the impact of Hurricane Ida over crude oil and gasoline with offline production and refining capacity due to the storm.
The unexpected release of crude oil from its reserve by China to “relieve pressure on commodity prices” had depressed oil markets on Thursday. But on Friday, analysts began examining what the launch could mean for future purchases of Chinese oil. While it’s not great for sentiment now, some analysts think it could herald an increase in Chinese demand in the coming months.
The release of crude from reserves “can be seen for the first time as bullish as it prepares for 4Q demand,” Bloomberg said, citing analysis company Oilytics in a report. According to the report, inventories “will eventually have to be replaced, so demand is being delayed.”
By Tsvetana Paraskova for Oilprice.com
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