Oil edged higher as traders gauged China’s economic outlook, along with geopolitical risks in Europe and the Middle East.
Brent traded above $85 after rising almost 6% last month, while West Texas Intermediate was around $82. A private gauge of China’s manufacturing activity showed an expansion in June to the highest in three years. That diverged from official data showing a contraction, clouding the outlook.
ADVERTISEMENT
CONTINUE READING BELOW
In France, Marine Le Pen’s National Rally dominated the first round of legislative elections, adding to political risk in the region, while Israel Prime Minister Benjamin Netanyahu said he is committed to fighting Hamas until it’s eliminated.
Crude’s rally since a nadir early last month has stalled in recent days, with US futures trading in a band of about $3 band over the last two weeks. OPEC+ has shored up prices by saying that any plan to add barrels back to the market will be dependent on market conditions. Money managers last week plowed cash back into US crude futures, while key spreads are in a bullish backwardation structure, indicating tight supplies.
“It looks like we will be carrying a little of momentum into the the third quarter with the backwardation elevated and hedge funds loading up on longs for a third consecutive week,” said Ole Hansen, Head of Commodities Strategy at Saxo Bank. “OPEC+ supply increase, or not, as well as geopolitics, China and US election potential key focus areas in the coming months.”
| Prices: |
|---|
|
© 2024 Bloomberg
