Brent crude oil prices rose above $87 a barrel, the highest since April

(MENAFN) On Friday, the price of Brent crude rose above $87 per barrel, reaching its highest level since April, driven by several key factors influencing the global oil market. International benchmark Brent crude was trading at $87.52 a barrel at 10:22 local time (0722 GMT), up a slight 0.10% from the previous session’s closing price of $87.43 a barrel. barrel. Meanwhile, U.S. benchmark West Texas Intermediate (WTI) rose to $84.10 a barrel, up 0.04 percent from its previous close of $84.06 a barrel.

A significant factor contributing to the rise in oil prices was the Energy Information Administration (EIA) report of a substantial 12.2 million barrel drop in US commercial crude oil inventories. This significant reduction far exceeded market expectations, which had anticipated a much smaller decline of around 400,000 barrels. Additionally, U.S. crude oil production fell by 27,000 barrels per day (bpd) to settle at around 13.58 million barrels per day for the week ended June 28. This drop in production has further fueled supply concerns among traders and investors, thus supporting upward pressure on oil prices. .

Expectations of increased travel activity during the summer season also bolstered market sentiment, suggesting a potential uptick in oil demand in the near term. Geopolitical tensions in the Middle East and Red Sea, crucial routes for oil and fuel shipments, added to market anxieties, providing further support to oil prices.

However, despite these optimistic factors, negative economic indicators in the US tempered the upward dynamics of oil prices. Reports showed that US private payrolls rose by 150,000 in June, below market expectations. In addition, annual wage growth slowed to 4.9%, the slowest rate since August 2021. Moreover, initial jobless claims rose by 4,000 to 238,000 in the week ended June 29, beating forecasts and signaling a potential weakness in the US labor market and the economy in general.

Overall, the combination of robust supply data, geopolitical tensions and expectations of seasonal demand growth juxtaposed with economic uncertainties contributed to the complex dynamics influencing oil markets on Friday.

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