2023-07-13 18:45:03 ET
Crude oil prices continued their recent bounce Thursday, rising for a third straight session to settle at their best levels since late April, supported by production cuts from Saudi Arabia and Russia, a weaker U.S. dollar, and expectations for record global oil demand this year.
The International Energy Agency forecast global oil demand would hit a record high this year, although "persistent macroeconomic headwinds" caused it to trim its predicted increase.
In its latest monthly report , the IEA forecast global oil demand growth of 2.2M bbl/day in 2023 to reach total demand of 102.1M bbl/day, but that's 220K bbl/day less than its prior estimated increase; in 2024, it projects oil demand growth slowing to 1.1M bbl/day.
"World oil demand is coming under pressure from the challenging economic environment," the IEA said. "Demand in the OECD, and Europe in particular, is languishing amid a grinding slowdown in industrial activity."
OPEC was more optimistic in its own separate report , forecasting global oil demand of 102M bbl/day this year, with demand growth of 2.4M bbl/day up 100K barrels from its previous monthly estimate due to higher demand from China; for 2024, it sees demand growth of 2.2M bbl/day.
Front-month Nymex crude ( CL1:COM ) for August delivery closed +1.5% to $76.89/bbl, and September Brent crude ( CO1:COM ) also settled +1.5% to $81.36/bbl.
WTI set a recent low of $67.05/bbl on June 28 but has been rising steadily since then, up more than 14%, with its 200-day moving average $77.34 looming ahead.
ETFs: ( NYSEARCA: USO ), ( BNO ), ( UCO ), ( SCO ), ( DBO ), ( USL ), ( DRIP ), ( GUSH ), ( USOI ), ( NRGU )
The oil and gas stock sector ( NYSEARCA: XLE ) ended modestly in the red, as a 1.8% decline in Exxon Mobil ( XOM ) following its acquisition of Denbury for $4.9B in stock, and losses in a few other names including Chevron ( CVX ), masked gains in most of the group.
Also in the news Thursday, production reportedly has been shut at Libya's El Feel, Sharara and 108 oilfields in a protest against the abduction of a former finance minister.
The Sharara field, one of Libya's largest production areas with a capacity of 300K bbl/day, has been a frequent political target; the field is run by state oil firm NOC with Spain's Repsol ( OTCQX:REPYF ) ( OTCQX:REPYY ), France's TotalEnergies ( TTE ), Austria's OMV ( OTCPK:OMVJF ) and Norway's Equinor ( EQNR ).
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Crude oil extends gains as global demand seen rising to record highs this year