Oil prices rose Tuesday, continuing the recent positive tone ahead of an industry report of weekly U.S. crude stocks as well as a key U.S. inflation release.
By 09:15 ET (13:15 GMT), U.S. crude futures traded 0.9% higher at $80.43 a barrel, while the Brent contract rose 0.5% to $84.62 a barrel.
The American Petroleum Institute, an industry body, is scheduled to release its weekly data on U.S. crude stockpiles later in the session and is expected to show another fall after last week’s drop of over 4 million barrels.
The API numbers serve as a precursor to official inventory data due from the U.S. Energy Information Administration, or EIA, on Wednesday.
Also due this week is the March U.S. consumer price index, which, if it shows a cooling of inflation, could go a long way towards persuading the Federal Reserve to pause its rate-hike cycle.
This would help the crude market as it would boost economic activity in the world’s largest economy as well as weaken the dollar. A weaker greenback makes oil cheaper for those holding other currencies.
The market has benefited from a rally in which prices have risen roughly 20% in the last three weeks, helped by OPEC+’s surprise decision to slash output beginning in May.
Also boosting sentiment were signs of demand growth in Asia.
Data released Tuesday showed that fuel consumption in India, the world’s third-biggest oil consumer, jumped by 5% in March from a year earlier.
Reuters also reported that Chinese airlines have started hiring in significant numbers, positioning for an expected rebound in travel demand this year after the relaxation of the country’s anti-COVID restrictions.
Speculators have ramped up their bullish bets on higher oil prices after the OPEC+ decision, posting the second-largest increase on record last week as net-long positions in Brent crude jumped by more than 73,000 contracts in the week to April 4, according to data from ICE.
Also of interest this week will be the monthly oil market reports from the OPEC and the International Energy Agency, due on Thursday and Friday, respectively. The two groups expect a recovery in China to drive oil demand to record highs this year.
