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Brent futures rose 21 cents to $76.82 a barrel at 0918 GMT. U.S.
West Texas Intermediate (WTI) crude also climbed 21 cents, to
$71.79.
Both benchmarks were on course for a modest weekly gain, having
been lifted by a mid-week announcement from the U.S. Federal
Reserve that it could cut borrowing costs next year.
The dollar fell to a four-month low on Thursday after the U.S.
central bank indicated interest rate hikes have likely ended and
lower borrowing costs are coming in 2024. The dollar index was
broadly steady on Friday.
A weaker dollar makes dollar-denominated oil cheaper for foreign
purchasers.
World oil consumption will rise by 1.1 million barrels per day
(bpd) in 2024, the IEA said in a monthly report, up 130,000 bpd
from its previous forecast, citing an improvement in the outlook
for U.S. demand and lower oil prices.
The 2024 estimate is less than half of the Organization of the
Petroleum Exporting Countries' (OPEC) demand growth forecast of
2.25 million bpd.
"OPEC+ production cuts are likely to keep the oil market in
balance at the start of 2024 despite weaker demand, which should
allay current oversupply concerns," Commerzbank said.
OPEC+, which groups OPEC and allies led by Russia, in late
November agreed voluntary cuts of about 2.2 million bpd lasting
throughout the first quarter.
Weak economic data from Germany, Europe's biggest economy, and
China, the world's biggest oil importer, weighed on prices,
however.
The HCOB German Flash Composite Purchasing Managers' Index
(PMI), compiled by S&P Global, fell for the sixth consecutive
month, declining to 46.7 in December from November's 47.8, below
the 48.2 forecast by economists.
Data released by China's statistics bureau on Friday showed
refinery runs in November dropped to their lowest level since
the start of 2023, as margin pressure on non-state owned
refiners saw them cut back production, while sluggish diesel
consumption weighed on national fuel demand.
Despite ongoing woes in China's property market, the data also
showed a better-than-expected performance in industrial output
and improving retail sales, lending some relief to market
sentiment amid the country's anaemic post-COVID economic
recovery.
(Additional reporting Andrew Hayley in BeijingEditing by Susan
Fenton)
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