Talks to raise the debt ceiling in the United States are set to resume in Washington on Monday, as markets fret over the continued possibility of the country’s default and the potential economic slowdown and lower demand for fuel. that would result.
And the International Energy Agency warned in its latest monthly report of an impending shortage in the second half of the year, in light of expectations that demand will exceed supply by around two million barrels per day. .
“I expect a lot of volatility in the coming days and a recovery in crude prices when an agreement is reached to raise the debt ceiling,” said Vandana Hari, oil market analyst at Vanda Insights.
Both crudes rose about 2% last week, their first weekly gain in five weeks, after wildfires in Alberta, Canada disrupted large amounts of crude oil supplies.
The impact of the OPEC+ alliance’s voluntary production cuts is also being felt after they took effect this month.
JPMorgan said total exports of crude oil and petroleum products from the alliance fell by 1.7 million barrels per day as of May 16, adding that Russian oil exports are expected to fall by the end of May.
On Saturday, the G7 countries pledged at their annual leaders’ meeting to redouble their efforts to deal with Moscow’s circumvention of the Russian oil price cap, “along with preventing indirect effects and preservation of the world’s energy supply”, but without going into details.
Fatih Birol, executive director of the International Energy Agency, said these measures are not expected to change the situation regarding the supply of crude oil and petroleum products.
For his part, the boss of Vitol Asia expected, on Monday, an increase in demand for oil in the second half, given the growth in Asian demand.
“We are approaching the second half of the year where the world will need about two million more barrels a day, largely due to growing Asian demand,” Mike Mueller said.
Brent crude futures rose 5 cents, or 0.01%, to $75.56 a barrel at 1450 GMT, and Nymex crude fell 11 cents, or 0.2%, to 71, $59.
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