Oil futures: Crude extends early-week gains, Brent tops $84/b
Quantum Commodity Intelligence – Crude oil futures Tuesday were climbing higher after benchmarks initially consolidated the 1% gains seen at the start of the week, amid brighter prospects on the demand outlook.
Front-month Jul24 ICE Brent futures were trading at $84.14/b (1745 GMT), compared to Monday's settle of $83.10/b, while the more-liquid Aug24 contract was trading at $83.88/b.
At the same time Jul24 NYMEX WTI was trading at $79.77/b, versus Friday's settle of $77.72/b. There was no settlement Monday due to the US holiday.
Prices on Monday increased on signals that oil consumption was picking up, particularly for transportation fuels, while expectations are growing for an OPEC+ rollover for at least another quarter when it meets at the weekend, while the producer group has even floated the idea of further cuts.
Brent was given a further lift Tuesday on reports that the North Sea Buzzard field, which is major component of the flagship Forties grade, was down for unscheduled maintenance.
Tensions in the Middle East also ratcheted up after an Israeli strike on Rafah left dozens of civilian casualties, while an Egyptian soldier was killed in a clash with Israeli military close to the Rafah Border Crossing.
Additionally, UN nuclear watchdog IAEA issued a report Monday warning over Iran's continuation of its uranium enrichment program, which could also heighten geopolitical tensions.
A number of economic indicators are due from the US and Europe this week as central bankers look for positive signals in the face of stubbornly high inflation.
"Inflation data in both the eurozone and the US were disappointing in the first few months of the year. This reduced expectations for interest rate cuts for this year by around 100 basis points for both currency areas," said Austria's Erste Bank in a research note.
Markets are still betting on a first European rate cut in June, but the US Fed is unlikely to trim borrowing costs before September.
Meanwhile, the National Oceanic and Atmospheric Administration (NOAA) said that the 2023 Atlantic hurricane season will likely bring an above-average number of named storms, as US weather watchers factored in the impact of the La Nina system.
