Oil prices continue to reap gains.. Brent crude is above $110 - Energy

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Oil prices rose about 1% during trading on Monday, with the increase in demand in the United States for fuel and the scarcity of supply.

It comes as Shanghai, China’s economic capital, is happy to reopen after a two-month shutdown that raised concerns about a sharp slowdown in growth.

Oil prices today

By 07:17 AM GMT (10:17 AM Mecca Al-Mukarramah), the price of the futures contract for the benchmark Brent crude – for delivery next July – rose by about 1.02%, to reach 113.70 dollars per barrel.

The price of future contracts for West Texas Intermediate crude – for delivery next July – increased by 0.90%, recording 111.27 dollars per barrel.

Oil prices ended their trading last Friday, after a volatile session, to record weekly gains for the fourth time in a row.

Gasoline pricesGasoline demand

“Oil prices are being supported, as gasoline markets remain tight amid strong demand heading into peak US driving season,” said Stephen Innes, managing partner of SBI Asset Management.

“Refineries are usually in an intensifying mode to feed the relentless thirst of American drivers at the pump,” he added, Reuters reported.

Peak driving season in the United States traditionally begins on Memorial Day weekend at the end of May and ends on Labor Day in September.

fuel prices

Analysts said that despite concerns about higher fuel prices potentially eroding demand, commuting data has risen in recent weeks, indicating that more people have been on the roads in places like the United States.

The weaker US dollar also pushed up oil prices on Monday, as it made crude oil cheaper for buyers holding other currencies.

Demand for oil in China

However, market gains were limited by concerns about China’s efforts to counter the closures imposed to contain the Corona virus, even despite the announcement of the reopening of Shanghai on June 1.

The shutdown in China, the world’s largest oil importer, has hit industrial production and construction, prompting steps to support the economy, including a bigger-than-expected mortgage rate cut last Friday.

“Covid-19 shutdowns are a temporary drag on demand in China, although demand elsewhere is holding up well,” ANZ analysts said in a note.

Analysts added, “We expect a recovery in industrial activity with the start of stimulus measures,” as reported by Reuters.

The inability of the European Union to reach a final agreement on Russia’s oil embargo for the invasion of Ukraine, which Moscow calls a “special operation”, has also prevented oil prices from rising much more.

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