Oil held steady on Thursday as traders weighed a stronger dollar against comments by President Joe Biden suggesting that the world’s biggest economy will resolve its debt crisis.
(Bloomberg) — Oil held steady on Thursday as traders weighed a stronger dollar against comments by President Joe Biden suggesting that the world’s biggest economy will resolve its debt crisis.
West Texas Intermediate futures hovered below $73, after surging almost 3% on Wednesday, when Biden expressed confidence that negotiators would reach an agreement to avoid a catastrophic default. Meanwhile, a gauge of the dollar earlier rose to its highest since late March, helping to keep a lid on oil prices.
Oil is still lower for the year as factors including US monetary tightening and uncertainty about China’s economic recovery weigh on the demand outlook. Russia’s crude exports — seemingly unaffected by sanctions related to Moscow’s war in Ukraine — have supported global supplies.
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The world’s demand for oil climbed by three million barrels a day to hit a record in March, according to the Riyadh-based International Energy Forum. In Asia, refiners in South Korea and Taiwan recently snapped up millions of barrels of US crude, while India is considering refilling its strategic hoard.
Elsewhere, Angola’s crude exports are set to rise to 1.2 million barrels a day in July, a jump of almost 20% compared with the June plan.
“Unease over the US debt ceiling deadlock is weighing on sentiment even though it is expected to soon be broken, thereby avoiding a US default,” PVM Oil Associates Ltd. said in a midday report. “Meanwhile, demand worries are also lingering.”
See also: The Oil Market’s Weakness Is Supply, Not Demand: Javier Blas
In the US, crude inventories rose by 5 million barrels last week, the biggest gain since February, according to the Energy Information Administration. The picture on key oil products was mixed, with gasoline stockpiles tightening but the four-week average for implied distillates demand dipping to the lowest seasonal level in a decade, with the exception of 2020.
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