Oil prices climb as cooler US inflation revives easing hopes
Shafaq News/ Oil prices rose onMonday as lower-than-expected U.S. inflation data revived hopes for furtherpolicy easing, although the outlook for a supply surplus next year weighed onthe market.
Brent crude futures rose 36 cents,or 0.5%, to $73.30 a barrel by 0421 GMT. U.S. West Texas Intermediate crudefutures climbed 39 cents, or 0.6%, to $69.85 per barrel.
"Risk assets, including U.S.equity futures and crude oil, have started the week on a firmer footing,"IG markets analyst Tony Sycamore said, adding that cooler inflation data helpedalleviate concerns following the Federal Reserve's hawkish rate cut.
"I think the U.S. Senatepassing legislation to end the brief shutdown over the weekend hashelped," he said.
Both oil benchmarks fell more than2% last week on concerns about global economic growth and oil demand after theU.S. central bank signalled caution over further easing of monetary policy.Research from Asia's top refiner Sinopec pointing to China's oil consumptionpeaking in 2027 also weighed on prices.
Money managers raised their net-longU.S. crude futures and options positions in the week to Dec. 17, the U.S.Commodity Futures Trading Commission (CFTC) said on Friday.
Concerns about European supply easedon reports the Druzhba pipeline, which sends Russian and Kazakh oil to Hungary,Slovakia, the Czech Republic and Germany, has restarted after halting onThursday due to technical problems at a Russian pumping station.
Shipments resumed on Saturday,according to Belarus' BelTa state news agency. On Sunday, Hungarian ForeignMinister Peter Szijjarto said supplies on Druzbha to the country had restarted.
Before the halt, the pipeline wasshipping 300,000 barrels per day of crude.
U.S. President Donald Trump onFriday urged the European Union to increase U.S. oil and gas imports or facetariffs on the bloc's exports.
The European Commission said it wasready to discuss with Trump how to strengthen what it described as an alreadystrong relationship, including in the energy sector.
Trump also threatened to reassertU.S. control over the Panama Canal on Sunday, accusing Panama of chargingexcessive rates to use the Central American passage and drawing a sharp rebukefrom Panamanian President Jose Raul Mulino.
In the U.S., the number of operatingoil rigs were up one to 483 last week, the highest since September, BakerHughes reported on Friday.
Macquarie analysts projected growingsupply surplus for next year, which will weigh down Brent prices to an averageat $70.50 a barrel, from this year's average of $79.64 a barrel, they said in aDecember report.
(REUTERS)
