Crude oil prices rose today, Friday, June 2, to continue the gains achieved in the previous session; The approval of raising the US debt ceiling, and the possibility of the Federal Reserve stopping raising interest rates contributed to calming market concerns, in addition to the possibility of reducing OPEC + production during the weekend, which supported prices.
Passage by the US Congress of a bill suspending the US government’s debt ceiling of $31.4 trillion helped avert a catastrophic default that would have roiled global financial markets.
The US crude inventories data issued on Thursday, June 1, 2023, from the Energy Information Administration, also reinforced market trends, according to what was seen by the specialized energy platform.
Investors’ focus is currently on the meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+) on June 4, 2023.
By 07:08 am GMT (10:08 am Mecca time), benchmark Brent crude futures – August 2023 delivery – rose by about 1.18%, equivalent to 88 cents, to $ 75.16, according to what the specialized energy platform monitored.
US West Texas Intermediate crude futures – July delivery -1.16%, or 81 cents, fell to $70.91.
Crude oil prices jumped by about 3% at the end of trading on Thursday, June 1, 2023, supported by the possibility of stopping raising US interest rates and taking decisive action to prevent default on the US debt, and this contributed to a state of optimism about the increase in oil demand growth in China.
Market analyst at OANDA, Edward Moya, said that oil prices witnessed stability after a round of disappointing global manufacturing data, indicating that it supported the position of OPEC + and discussed the possibility of further reducing production, according to what was published by Reuters.
On the other hand, the American Institute for Supply Management revealed, on Thursday, June 1, 2023, that industrial production contracted for the seventh consecutive month during May.
He said that the PMI for industries fell to 46.9 points during the past month, compared to 47.1 points in April; this indicates a contraction in manufacturing activity in the world’s largest oil consumer.
While the Chinese data was mixed, official government data reported that factory activity in May contracted to a 5-month low, contrasting with the Caixin Index and S&P Global Platts Index after showing slight expansion over the past month.
Moya added, traders believe that Russia may not necessarily stick to a hard line on production cuts, especially as they struggle to stick to their prices.