Oil climbs on diminishing recession fears
Oil bolstered on fading recession fears in the US, reports Reuters.
A barrel of European reference crude Brent trades at USD 75.35 on Monday morning, up from USD 72.13 on Thursday afternoon. US benchmark West Texas Intermediate simultaneously goes for USD 71.45 against USD 68.11.
Concerns as to whether the US banking crisis would slow down the economy and exhaust oil demand in the country drove the Brent benchmark down 5.3% last week, while WTI plunged 7.1%.
However, oil recovered by 4% on Friday on strong US jobs report, a weaker greenback and expectations of supply cuts next time the Organization of Petroleum Exporting countries and their allies, OPEC+, convenes in June.
”Crude prices are trying to stabilize as energy traders wait to see if OPEC+ might have to signal they are willing to reduce output even further,” said Edward Moya, an analyst at OANDA, according to Reuters.
An analyst with ANZ Research expects markets focus to change from economic concerns and center on tightening oil supply.
This week, traders will await developments in US consumer price inflation figures on Wednesday for signs of possible interest rate hikes.
Similarly, market keenly awaits Chinese economic indicators for signs of economic recovery.
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