Futures on US West Texas Intermediate Crude Oil were on course to register a 1.9% weekly advance, as market players continued weighing geopolitical tensions and latest oil supply projections.
Yesterday Pakistan launched strikes on separatist militants on Iranian soil in retaliation two days after Tehran said it had hit the bases of another group in Pakistan.
“As tensions in the Middle East are spreading, traders don’t want to take short positions, but they are also cautious about continuing to build long positions as China’s economic recovery remains slow,” Hiroyuki Kikukawa, President of NS Trading, was quoted as saying by Reuters.
“Unless tensions in the Middle East quickly escalate further, WTI is likely to continue trading in a range around $70-$76,” Kikukawa added.
Meanwhile, also on Thursday, the International Energy Agency again revised up its 2024 global oil demand growth forecast.
The IEA now expects global oil consumption to rise by 1.24 million barrels per day this year, or an increase of 180,000 bpd from its prior forecast.
The IEA also forecasts that global oil supply will rise by 1.5 million barrels per day to a fresh record high of 103.5 million bpd this year, driven by record-setting production from the United States, Canada, Brazil and Guyana.
“Barring significant disruptions to oil flows, the market looks reasonably well supplied in 2024, with higher-than-expected non-OPEC+ production increases set to outpace oil demand growth by a healthy margin,” the IEA said in a report.
WTI Crude Oil Futures for March delivery were last edging up 0.39% to trade at $74.24 per barrel.
At the same time, Brent Oil Futures for March delivery were up 0.35% on the day to trade at $79.38 per barrel.
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