LONDON, UK – Oil prices increased on Friday, as a rebound in global demand was generally expected, and a gradual recovery for the US Gulf Coast export and refining hub from Hurricane Harvey earlier this week appeared likely to further deplete stockpiles.
At 1231 GMT, Brent crude prices were up 39 cents, or 0.5 percent, to $73.42 a barrel, while WTI crude futures were up 21 cents, or 0.3 percent, to $70.20 a barrel. For the week, both benchmark oil contracts remained basically unchanged.
According to Reuters, over 1.7 million barrels per day of oil production in the US Gulf of Mexico is still shut down, with damage to heliports and fuel depots hindering the return of crews to offshore facilities.
“Data showing continued strong domestic fuel demand recovery, as well as the prolonged US Gulf production and Louisiana refining capacity outages, which are bound to carve a bigger hole in the already diminished US oil stockpiles, are supportive factors,” said Vandana Hari, energy analyst at Vanda (NASDAQ:) Insights.
After the Organization of the Petroleum Exporting Countries and Allies, known as OPEC+, kept to its plan to add 400,00 barrels per day (bpd) to the market over the next few months, some experts anticipate opportunity for more price gains amid tightened oil supplies and signs of recovering demand.
The US applauded the initiative and promised to encourage the exporter group to do more to help the economy recover by boosting output.
“With an oil market still in deficit for the rest of the year, oil looks primed to gain even more as OPEC+ demonstrates discipline in relaxing cuts and as U.S. stocks continue to drop,” said Edward Moya, senior market analyst at OANDA.
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