EghtesadOnline: Brent crude prices eased on Friday but hovered near $70 a barrel as production cuts by major oil producers constrained supply, with optimism about a recovery in demand for the resource in the second half of the year also lending support.
Brent crude futures for May slipped 33 cents, or 0.5%, to $69.30 a barrel by while US West Texas Intermediate crude for April was at $65.65 a barrel, down 37 cents, or 0.6%, Reuters reported.
After seven straight weeks of gains, front-month Brent could close this week little changed as investors took profit after prices touched a 13-month high on Monday following attacks on Saudi Arabian oil facilities.
Sentiment was also buoyed by the decision of the Organization of Petroleum Exporting Countries and its allies, a group known as OPEC+, earlier this month to largely hold production cuts in April.
Investors have been pumping funds into commodities such as oil on expectations of a demand recovery in the second half of the year as the global economy grows, while a wider rollout of vaccines against the Covid-19 pandemic allows more people to travel this summer.
“Assuming vaccination programs are successful, we expect pent-up demand for gasoline to be released this summer during the US and European driving season,” FGE analysts said in a note.
OPEC said on Thursday a recovery in oil demand will be focused on the second half of the year.