By Peter Nurse
Investing.com — Crude oil prices rose slightly Thursday as positive sentiment over an infrastructure deal announced by the Biden administration helped overcome concerns about additional supply being announced at next week’s meeting of top producers.
settled up 22 cents, or 0.5% at $73.30 a barrel. On Wednesday, WTI rose as high as $74.25, a peak not seen since October 2018.
finished the session at $75.56, up 37 cents, or 0.5%, after scaling $76.02 in the previous session, also a peak since October 2018.
Crude settled higher after President Joe Biden said his Democratic Party managed to strike a contentious infrastructure deal with rival Republicans, without any tax hikes involved.
Earlier on Thursday, oil was weighed down by expectations that the Organization of Petroleum Exporting Countries and allies, a group known as OPEC+, was considering increasing supply at its meeting next week to curb the rapid rise in crude prices.
Saudi Energy Minister, Prince Abdulaziz bin Salman, the de facto leader of the group, was reported Thursday saying that “we have a role in taming and containing inflation, by making sure that this market doesn’t get out of hand.”
This follows reports out of earlier this week suggesting it, one of the most influential members of the group, was considering proposing an increase in oil output at next week’s meeting.
Oil markets have soared this year, with both benchmarks more than 40% higher year-to-date, on hopes of a quick return to peak demand as Covid-19 passes as well as OPEC+’s cautious husbandry of global supply.
Evidence of the increased demand in the U.S., the globe’s largest consumer, came from the reporting a drop in U.S. stockpiles of 7.6 million barrels for the week ended June 18, the fifth consecutive week that stocks have fallen, the longest run since January 2021.
This group is scheduled to meet toward the end of next week to discuss production quotas for August, and possibly beyond. OPEC+ has been steadily increasing output as the global economy recovers from the ravages caused by the Covid-19 pandemic, but is still withholding more than 5 million barrels a day of production from the market.
Earlier Thursday, in annual talks with OPEC+, India’s oil minister called for “affordable” energy, warning about the impact of rising oil prices on consumers.
India is the third largest consuming country in the world, and these comments will add pressure on the producers ahead of the meeting.
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