Oil prices were rising early on Friday and headed to a second consecutive week of gains after the U.S. signaled that there may not be an imminent announcement of an agreement for the United States and Iran to return to the Iranian nuclear deal.
As of 9:21 a.m. EDT on Friday, WTI Crude was nearing the $70 mark and traded at $69.51, up by 1.03 percent. Brent Crude was also rising and seeking to break the $72 threshold—it traded at $71.88, up 0.81 percent.
Oil prices have risen for most of this week amid signs of recovering demand in the United States and Europe, which have outweighed coronavirus concerns in parts of Asia, including India.
On Tuesday, OPEC+ confirmed its plan to ease the production cuts by 840,000 barrels per day (bpd) in July, suggesting that despite COVID setbacks in Asia, the alliance sees strong demand ahead with the start of the driving season. This sent Brent Crude prices topping $71 a barrel.
A large draw in crude oil inventories in the United States, a draw of 5.1 million barrels in the week to May 28, also boosted bullish sentiment on Thursday. Crude inventories in the U.S. are now at 3 percent below the five-year average for this time of the year.
On Friday, oil prices rose after the United States said there would be a sixth round of talks in Vienna regarding the Iranian nuclear deal, and possibly further rounds, which delays the timeline for Iran’s oil to return legitimately to the market.
“We expect there will be a sixth. I think there’s just about every expectation that there will be subsequent rounds beyond that,” U.S. State Department spokesman Ned Price said on Thursday, quoted by Reuters.
Commenting on the oil price movements this week, Saxo Bank said on Thursday:
“The bullish demand outlook presented by OPEC based on strong demand in Europe, China and the US has triggered renewed upside momentum, and from a technical perspective, today’s focus is whether Brent can break the four-time rejected area just below $72. If successful, the technical outlook points to $75 as the next target.”
By Tsvetana Paraskova for Oilprice.com
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