Oil set to achieve most significant monthly gains in a year
Shafaq News / Oil prices edged lower on Monday, but were hovering near three-month highs, set to post their biggest monthly gains in over a year on expectations that Saudi Arabia would extend voluntary output cuts into September and tighten global supply.
Brent crude futures were down 45 cents to $84.54 a barrel by 0315 GMT while U.S. West Texas Intermediate crude was at $80.25 a barrel, down 33 cents.
The September Brent contract will expire later on Monday. The more active October contract was at $84.23 a barrel, down 18 cents.
Brent and WTI settled on Friday at their highest levels since April, gaining for a fifth straight week, as tightening oil supplies globally and expectations of an end to U.S. interest rate hikes supported prices. Both are on track to close July with their biggest monthly gains since January 2022.
"While it seems that crude may have priced in all the good news on U.S. inflation and economic resiliency for the time being, it may continue inching higher still," said Vandana Hari, founder of oil market analysis provider Vanda Insights.
"Most of the strong buying activity has been occurring during the U.S. trading hours; action during the Asian session remains relatively slow and a poor indicator of sentiment," Hari added.
Meanwhile, Saudi Arabia is expected to extend a voluntary oil output cut of 1 million barrels per day (bpd) for another month to include September, analysts said.
"Oil prices are up 18% since mid-June as record high demand and Saudi supply cuts have brought back deficits, and as the market has abandoned its growth pessimism," Goldman Sachs analysts said in a July 30 note.
(Reuters)
