Oil Set for First Weekly Gain in a Month as Output Cuts Start - Bloomberg:
Oil headed for its first weekly gain in a month as global production cuts began to take effect, while early signs the coronavirus-driven plunge in demand might be starting to bottom out also aided sentiment.
Futures in New York edged above $19 a barrel and are up around 13% so far this week. The OPEC+ bloc’s 10 million barrels a day of output reductions officially start from Friday, while other producers -- including Norway and ConocoPhillips -- have also said they’re cutting back.
Crude’s revival this week was supported by government data showing U.S. gasoline demand rose by the most in almost a year last week and stockpiles of the fuel shrunk. In China, the world’s biggest oil importer, rush-hour traffic in some of the biggest cities has recovered to pre-virus levels.
While the demand data is encouraging it will take some time to clear a massive glut that has built up due to virus lockdowns and the price war, with Saudi Arabia exporting the most crude in at least three years last month. Citigroup Inc. warned the worst is likely yet to come for the oil market as global storage nears capacity even as consumption starts to recover.
Oil headed for its first weekly gain in a month as global production cuts began to take effect, while early signs the coronavirus-driven plunge in demand might be starting to bottom out also aided sentiment.
Futures in New York edged above $19 a barrel and are up around 13% so far this week. The OPEC+ bloc’s 10 million barrels a day of output reductions officially start from Friday, while other producers -- including Norway and ConocoPhillips -- have also said they’re cutting back.
Crude’s revival this week was supported by government data showing U.S. gasoline demand rose by the most in almost a year last week and stockpiles of the fuel shrunk. In China, the world’s biggest oil importer, rush-hour traffic in some of the biggest cities has recovered to pre-virus levels.
While the demand data is encouraging it will take some time to clear a massive glut that has built up due to virus lockdowns and the price war, with Saudi Arabia exporting the most crude in at least three years last month. Citigroup Inc. warned the worst is likely yet to come for the oil market as global storage nears capacity even as consumption starts to recover.
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