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Brent crude futures rose $1.12, or 1.4%, to settle at $83.55 a
barrel, their highest close since Nov 30. U.S. West Texas
Intermediate crude (WTI) <CLc1> climbed 65 cents or 0.8% to
$78.01, also the highest close since November.
Both benchmarks made weekly gains of more than 6%, marking their
biggest weekly increase since the week ending Oct. 13 after the
start of the Israel-Hamas conflict in Gaza.
"Economic stimulus from China, stronger-than-expected 4Q GDP
growth in the U.S., cooling U.S. inflation data, ongoing
geopolitical risks, and the larger-than-expected 9.2
million-barrel drop in U.S. commercial crude stocks for last
week have all combined to wedge prices higher," said Tim Evans,
an independent oil market analyst.
The Houthi military spokesperson said naval forces carried out
an operation targeting an oil tanker in the Gulf of Aden,
causing a fire to break out, adding to worries of supply
disruptions.
Oil was also boosted earlier this week by a larger-than-expected
drawdown in U.S. crude stockpiles. The depletion in inventories,
especially around the WTI delivery point at Cushing in Oklahoma
and across the Midwest, could create a squeeze on nearby futures
prices.
Supply concerns are evident in the structure of Brent futures.
The premium of the first-month contract to the sixth on both
Brent and WTI rose to the highest since November, indicating a
perception of tighter prompt supply.
A potential fuel supply disruption after a Ukrainian drone
attack on an export-oriented oil refinery in southern Russia
also supported prices.
On the demand side, the U.S., the world's biggest oil consumer,
registered faster-than-expected economic growth in the fourth
quarter, data showed on Thursday. Sentiment was also buoyed this
week by China's latest measures to boost growth.
Traders, however, bet the U.S. central bank is more likely to
start its round of rate cuts in May, rather than March, weighing
on crude futures.
Also curbing gains, Baker Hughes said U.S. energy firms this
week added two oil rigs, pushing the figure up to 499.
Money managers raised their net long U.S. crude futures and
options positions in the week to Jan. 23, the U.S. Commodity
Futures Trading Commission (CFTC) said.
(Reporting by Arathy Somasekhar and Georgina McCartney in
Houston; Additional reporting by Andrew Hayley in Beijingand
Alex Lawler in London; Editing by Kirsten Donovan, Bill Berkrot,
Chris Reese, Cynthia Osterman, David Gregorio and Marguerita
Choy)
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