LONDON: Oil prices rose on Friday, with global benchmark Brent set for its first weekly gain in three weeks as economic indicators from big consumers China and the United States bolstered hopes for higher demand.
China’s industrial output grew by 6.7% year on year in April as recovery in its manufacturing sector gathered pace, accelerating from the 4.5% in March and pointing to possibly stronger demand to come.
Brent crude oil rose 39 cents, or 0.47%, to $83.66 a barrel by 0750 GMT.
US West Texas Intermediate (WTI) crude was up 22 cents, or 0.28%, at $79.45.
Tamas Varga of oil broker PVM said that while the Chinese figures and another attack on Russian oil infrastructure were boosting prices, oil had yet to make a convincing recovery from its recent slump.
“The lack of explicit enthusiasm is probably the function of tepid product demand depressing refining margins,” he said.
Authorities have managed to contain a fire that started at Russia’s Tuapse oil refinery after a Ukrainian drone attack, officials in the Krasnodar region said.
Brent is on track for an increase of about 1% over the week, with WTI on course for a 1.5% gain.
Oil prices make gains
Declines in oil and refined products inventories at global trading hubs have also created optimism over demand, reversing a trend of rising stockpiles that had weighed heavily on crude oil prices in previous weeks.
OANDA senior market analyst Kelvin Wong cited “several encouraging factors”, including two consecutive weeks of decline in US crude stockpiles and expectations of more economic stimulus measures from China.
Recent economic indicators from the United States have fed into the optimism over global demand.
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