In early Asian trade on Friday, concerns about Middle Eastern supply grew and factory activity in China, the world’s second largest consumer of crude, boosted sentiment. This led to an increase in oil prices.
Brent futures were up 15 cents, or 0.19 percent, at $79.42 a barrel at 0146 GMT, after rising nearly 6 percent this week. After gaining approximately 8% this week, U.S. West Texas Intermediate (WTI) crude CLc1 increased by 17 cents, or 0.23%, to $74.54.
China’s manufacturing activity rose in Spring at a more slow speed contrasted and a record breaking development in February, yet at the same time surpassed assumptions by financial experts in a Reuters survey.
In light of weaker global demand and China’s lifting of coronavirus-related restrictions, industrial activity has emerged as a significant price driver in recent weeks.
After the largest bank failure since the 2008 financial crisis frightened traders and threw markets into turmoil, oil prices are expected to cap a second week of gains. After two U.S. and European banks were saved, fears of a full-blown global banking crisis have subsided.
Prices increased by more than 1% on Thursday as a result of lower U.S. crude stockpiles and a halt to exports from Iraq’s Kurdistan region, which offset pressure from a smaller-than-anticipated cut to Russian supplies.
Following the stoppage of the northern export pipeline, producers have shut down or reduced output at several oilfields in the semi-autonomous Kurdistan region of northern Iraq. There will be additional outages soon.
According to the Energy Information Administration (EIA), crude oil stockpiles in the United States unexpectedly fell to a two-year low in the week ending March 24.
Markets are currently awaiting Friday’s spending and inflation data, which will have an effect on the value of the US dollar.