Oil Prices Rise Following Bullish Demand Growth Forecasts
Brent crude futures were up 76 cents, or 1%, at $75.05 a barrel by 0916 GMT. U.S. West Texas Intermediate (WTI) crude was up 63 cents, or 0.9%, at $70.05.
Both benchmarks climbed more than 3% the previous day on hopes of rising fuel demand after China’s central bank lowered a short-term lending rate.
Higher interest rates strengthen the dollar, making commodities denominated in the U.S. currency more expensive for holders of other currencies.
A pause in the Fed’s rate increases would spur economic growth and oil demand, supporting prices.
The IEA, increased its oil demand growth forecast for this year by 200,000 barrels per day (bpd) to 2.4 million bpd, lifting the projected total to 102.3 million bpd.
However, the agency expects economic headwinds to reduce growth to 860,000 bpd next year and increasing use of electric vehicles to help to reduce that to 400,000 bpd in 2028 for overall demand of 105.7 million bpd.
The IEA’s 2023 oil demand growth figure is slightly above that of the Organisation of the Petroleum Exporting Countries (OPEC).
Reuters/Hauwa Abu
