Mumbai, 11 Jun (Commoditiescontrol): Crude oil prices rose on Tuesday, building on Monday's rally driven by expectations of increased seasonal fuel demand and potential U.S. crude purchases for its petroleum reserve. However, the gains were tempered by a firmer dollar.
Brent crude futures climbed 28 cents, or 0.3%, to $81.91 per barrel, while U.S. West Texas Intermediate crude futures rose 31 cents, or 0.4%, to $78.05. On Monday, both benchmarks had surged approximately 3% to a one-week high, supported by the anticipation of robust summer fuel demand despite the dollar's strength, which was bolstered by expectations that the U.S. Federal Reserve will maintain higher interest rates for longer.
Energy Secretary Jennifer Granholm indicated last week that the U.S. could expedite the replenishment of the Strategic Petroleum Reserve (SPR) once maintenance is completed by the end of the year. The U.S. aims to buy back oil at around $79 per barrel.
Goldman Sachs analysts sees Brent reaching $86 per barrel in the third quarter, due to strong summer transport demand pushing the oil market into a deficit of 1.3 million barrels per day (bpd).
Investor focus is now on the upcoming U.S. consumer price index data for May and the conclusion of the Federal Reserve's two-day policy meeting on Wednesday, seeking indications of when the Fed might begin lowering interest rates.
Market participants are also awaiting reports from the American Petroleum Institute, due later on Tuesday, and the Energy Information Administration (EIA), the statistical arm of the U.S. Department of Energy, due on Wednesday. Preliminary data from a Reuters poll on Monday suggested that U.S. crude oil stockpiles likely fell last week, while product inventories increased.
Additionally, investors are anticipating monthly oil supply and demand data from the EIA and OPEC on Tuesday, followed by the International Energy Agency (IEA) on Wednesday.
As these developments unfold, the oil market remains attentive to potential shifts in supply and demand dynamics, influenced by both economic indicators and strategic reserve management.
(By Commoditiescontrol Bureau: 09820130172)
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