(Bloomberg) — Oil traded near $91 a barrel on London as global fuel markets continued to tighten amid robust demand and supply curbs by top OPEC+ members.
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Brent crude pushed edged higher on Tuesday, after hitting a new high for the year during the previous session. Diesel — the workhorse fuel of the global economy — is rallying after Russia planned to limit exports this month, pushing futures in Europe past $1,000 a ton.
“The oil industry feels a collective rally risk with a perception of, and actual tightening in parts, of oil flow,” said John Evans, an analyst at brokers PVM Oil Associates Ltd. in London.
Oil futures have rallied by roughly 25% since late June as global fuel demand hits new all-time highs, while Saudi Arabia and Russia constrict supplies to bolster their petroleum revenues. The US dollar tumbled the most in almost two months on Monday, making commodities priced in the currency more attractive for most buyers.
Nonetheless, prominent forecasters such as JPMorgan Chase & Co. and RBC Capital Markets LLC say that their core outlook doesn’t assume prices will keep surging to $100 a barrel.
The Organization of Petroleum Exporting Countries and US Energy Information Administration will both publish monthly market reports later Tuesday, with the International Energy Agency’s due on Wednesday.
“The upward momentum is exhausted for now,” said Vandana Hari, founder of Vanda Insights in Singapore. “Crude needs fresh cues to pick a direction. We may see a holding pattern of around $90 for Brent.”
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