Oil settles up on signs of strong demand; investors await OPEC+ decision
Oil prices edged higher on Tuesday as investors took stock of positive demand indicators, while also treading cautiously ahead of an OPEC+ meeting to decide the group's August output policy.
Brent crude settled up 37 cents, or 0.6%, at $67.11 a barrel, while U.S. West Texas Intermediate crude settled 34 cents higher, or up around 0.5%, at $65.45 a barrel.
The gains were likely due to supportive data from a private-sector survey in China, which showed factory activity returned to expansion in June, said Randall Rothenberg, a risk intelligence expert at U.S. oil brokerage Liquidity Energy.
Expectations that Saudi Arabia will raise its August crude oil prices for buyers in Asia to a four-month high as well as firm premiums for Russian ESPO Blend crude oil were also supporting the notion of robust demand, Rothenberg said.
Oil's gains were kept in check by expectations that the OPEC+ group will boost its August crude oil output by an amount similar to the outsized hikes agreed in May, June, and July. Four OPEC+ sources told Reuters last week the group plans to raise output by 411,000 barrels per day next month when it meets on July 6.
Besides gaining market share from U.S. shale producers, which pumped oil at a record pace in April, according to official data released on Monday, the group has also been trying to punish overproducing members.
OPEC+ member Kazakhstan, one of the world's 10 largest oil producers, raised oil production last month to match an all-time high, a source familiar with the data told Reuters on Tuesday.
Saudi Arabia, the de facto leader of the OPEC+ group, raised its June crude oil exports to the fastest rate in a year, data from Kpler showed.
Investors are also watching trade negotiations ahead of U.S. President Donald Trump's tariff deadline of July 9. Trump on Tuesday said he is not thinking of extending the deadline.
Source : Reuters
