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On Monday, 23 December, oil prices rose after the release of US inflation data, which came in below expectations, Reuters reports.
Current prices
Brent crude rose by 36 cents, or 0.5%, to $73.30 per barrel. U.S. West Texas Intermediate (WTI ) rose by 39 cents, or 0.6%, to $69.85 per barrel.
Inflation impact
IG Markets analyst Tony Sycamore noted that the positive inflation data eased investor concerns after the recent US Federal Reserve rate decision, which had created tension in the markets.
“Riskier assets, including US equities and oil, are showing a stronger position at the start of the week,” Sycamore added.
Market pressure
Last week, both key oil indicators fell by more than 2%. This happened amid concerns about global economic growth and a decline in oil demand.
A study by Asian oil refining giant Sinopec points to a possible peak in China’s oil consumption by 2027, which also had a certain negative impact on prices.
European deliveries
Supply concerns have eased following the reopening of the Druzhba pipeline, which transports Russian and Kazakh oil to the EU. The pipeline, which was shut down due to technical problems, resumed shipments on Saturday. Supplies to Hungary have also resumed, Hungarian Foreign Minister Péter Szijjártó confirmed.
Before the shutdown, the pipeline was transporting 300,000 barrels of oil per day.
Production in the USA
Last week, the number of operating oil rigs in the US increased by one, reaching 483 units, the highest since September. This data was released by Baker Hughes.
Despite the short-term price increase, analysts predict that a possible oversupply in 2024 and uncertainty in demand may dampen market optimism.
