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Brent crude futures rose 41 cents, or 0.5%, to settle $86.81 a
barrel, while U.S. West Texas Intermediate (WTI) crude futures
gained 37 cents, or 0.5%, to settle at $83.19. On a weekly
basis, both benchmarks rose about 0.5%.
The IEA estimated that global oil demand hit a record 103
million barrels per day in June and could scale another peak
this month.
Meanwhile, output cuts from Saudi Arabia and Russia set the
stage for a sharp decline in inventories over the rest of 2023,
which IEA said could drive oil prices even higher.
On Thursday, the Organization of the Petroleum Exporting
Countries (OPEC) said it expects global oil demand to rise by
2.44 million bpd this year, unchanged from its previous
forecast. Prospects for the oil market look healthy for the
second half of the year, OPEC said.
U.S. economic data this week also lifted market sentiment,
fueling speculation that the Federal Reserve is nearing the end
of aggressive rate hikes.
Supply cuts and an improving economic outlook have created more
optimism among oil investors, OANDA analyst Craig Erlam said.
However, he noted signs momentum was wearing thin after a
sustained rally. On Thursday, Brent hit its highest since
January, a day after WTI hit its highest this year.
The last time that Brent rose for seven straight weeks was in
January-February 2022, prior to Russia's invasion of Ukraine.
After falling for eight weeks in a row, the number of oil rigs
operating in the U.S., an early indicator of future output, held
steady at 525 this week, energy services firm Baker Hughes said.
The steady oil rig count indicates U.S. producers are
maintaining discipline about drilling and exploration, said Eric
Freedman, Chief Investment Officer at U.S. Bank Asset
Management.
"The oil price keeps going higher but not as many companies are
out looking for oil," he said.
Mixed economic data from China weighed on sentiment this week.
While customs data showed crude imports up year on year, China's
overall exports plunged 14.5% in July, with monthly crude
imports retreating from June's near-record highs to their lowest
level since January.
(Reporting by Shariq Khan; Additional reporting by Ahmad Ghaddar
and Andrew Hayley; Editing by Elaine Hardcastle, Marguerita
Choy, Cynthia Osterman and David Gregorio)
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