Home Industry Energy Oil powers toward fifth weekly gain as market starts to tighten West Texas Intermediate edged below $80 a barrel on Friday by Bloomberg July 28, 2023 Image credit: Unsplash Oil headed for the longest run of weekly gains in more than a year on an improving macroeconomic outlook and signs of a tighter market. West Texas Intermediate edged below $80 a barrel on Friday, but has still rallied more than 3 per cent this week for a fifth consecutive gain. In the US, economic growth exceeded expectations, and there’s speculation the Federal Reserve is near or at the end of its tightening cycle. Chinese authorities, meanwhile, have pledged more stimulus to support growth in the largest crude importer. Crude holdings at the key US storage hub at Cushing, Oklahoma, have declined by 7.5 million barrels over the past four weeks, pushing stockpiles to their lowest since May. That’s helping to support a widening of WTI’s backwardation for its nearest two contracts, a bullish pricing pattern. The rally in the US crude benchmark means that prices have all but erased the year’s losses after OPEC+ linchpins Saudi Arabia and Russia both curbed exports. That’s led banks including Standard Chartered and UBS Group AG to forecast tightening global balances and higher prices over the rest of the year. Recent economic data including the US GDP print suggests there’s “economic resilience, which provides further validation for soft landing hopes and suggests a much brighter demand outlook for oil,” said Yeap Jun Rong, market strategist for IG Asia. There’s also “signs of improving dynamics in supply conditions” which is helping bearish sentiment to unwind, he said. US supermajor Exxon Mobil is set to report quarterly earnings Friday, offering traders insight into the outlook. Competitor Chevron will also flesh out the details behind its figures for the period after an initial announcement. Read: Oil holds loss after Fed raises rates to highest in 22 years Tags energy oil 0 Comments You might also like Abu Dhabi’s Masdar, Presight to develop AI asset management tool OPEC cuts 2024, 2025 global oil demand growth view again ADNOC L&S JV inks deal worth $250m for mega ammonia carriers Most Gulf markets fall on geopolitics, weak oil