Oil prices edged higher Monday, helped by bullish comments from OPEC, although renewed concerns over waning demand in the United States and China limited gains.
By 09:30 ET (14.30 GMT), the U.S. crude futures traded 0.2% higher at $77.34 a barrel, while the Brent contract climbed 0.3% to $81.64 a barrel.
OPEC lifts 2023 global demand forecast
The Organization of Petroleum Exporting Countries released its latest monthly report earlier Monday, and lifted its forecast for global crude demand for 2023 to 2.46 million barrels per day, from 2.44 million barrels.
The group of major suppliers said that global oil market fundamentals remain strong despite “exaggerated negative sentiments,” adding that while prices have trended lower in recent weeks this was mainly due to speculative behavior.
The report also decried overblown pessimism towards China’s oil demand performance, saying Chinese crude imports remain “very healthy.”
U.S., China demand worries remain
Crude prices still fell about 4% last week, registering the first three-week losing streak since May, as investors focused on slowing demand in the United States and China while worries over potential supply disruptions from the Israel-Hamas conflict receded.
China, the world’s biggest crude oil importer, released a series of weak economic numbers last week, raising fears of faltering demand, while China’s Singles Day over the weekend recorded only meager growth.
In the U.S., the Energy Information Administration last week said that the country’s crude oil production this year will rise by slightly less than previously expected and that demand will fall.
Next year, per capita U.S. gasoline consumption could fall to the lowest level in two decades, it added.
OPEC meeting, U.S. CPI in focus
Attention will shortly focus on the next meeting of OPEC and allies, a group known as OPEC+, on Nov. 26, with trader wanting to find out whether Saudi Arabia plans to extend a 1 million barrel-per-day voluntary cut set to expire at the end of this year.
Additionally, U.S. consumer prices for October on Tuesday, for an update on the Fed’s progress in its battle to keep lowering inflation from last year’s multi-decade highs.
Hawkish signals from Federal Reserve officials have boosted the dollar of late, weighing on the crude market as a stronger U.S. currency makes the commodity more expensive for foreign buyers.
