Oil prices rose on Friday after a volatile week, with talk from US leaders on an upcoming US debt ceiling agreement reassuring investors of a possible US default.
Around 10:00 GMT (12:00 in Paris), a barrel of Brent from the North Sea, for delivery in July, took 0.64% to 76.75 dollars. Its American equivalent, a barrel of West Texas Intermediate (WTI) for delivery the same month, gained 0.82% to 72.42 dollars. With a marked rise at the start of the week and a tumble on Thursday, prices are heading for a slight weekly rise: +1.55% for Brent and +1.05% for WTI.
“Macro trends like the US debt ceiling negotiations and the possibility of Federal Reserve rate hikes remain at the heart of the oil market,” said Stephen Brennock, analyst at PVM. Negotiations on the debt ceiling between the White House and the Republican opposition are “productive”, assured Thursday the spokeswoman for the executive, Karine Jean-Pierre, removing the prospect of a default on payment of the States -United.
Such a default would risk causing a recession, which would cripple the demand for black gold around the world. “If American politicians come to an agreement quickly, it would boost oil prices,” Han Tan, an analyst at Exinity, told AFP.
The remarks of the leaders of the members of OPEC + (Organization of the Petroleum Exporting Countries and its allies) are also scrutinized in the run-up to its meeting in early June.
Saudi Arabia’s energy minister warned on Wednesday that investors betting on lower prices could suffer, which was interpreted as a promise of deeper OPEC+ production cuts.
“However, we don’t expect production to decline further,” analysts at Commerzbank said, noting that the latest announced production cuts only came into effect this month. “The market is already undersupplied,” they add, noting that US trade reserves are at low levels.