Oil and Gas Prices Oil prices climbed about 1 per cent to a four-month high on Monday on lower crude exports from Iraq and Saudi Arabia and signs of stronger demand and economic growth in China and the U.S.
Brent futures were up 88 cents, or 1.0 per cent, to $86.22 a barrel by 11:28 a.m. EDT (1528 GMT), while U.S. West Texas Intermediate (WTI) crude rose $1.01, or 1.3 per cent, to $82.05.
That put both benchmarks on track for their highest closes since Nov. 2 and pushed both into technically overbought territory.
In other energy markets, U.S. gasoline futures were on track to close at their highest price since September 2023 for a fourth day in a row.
That price increase boosted the gasoline and 3-2-1 crack spreads, which measure refining profit margins, to their highest since August and September 2023, respectively.
On the supply side, Iraq, OPEC’s second-largest producer, said it would reduce crude exports to 3.3 million barrels a day (bpd) in the coming months to compensate for exceeding its OPEC+ quota since January, a pledge that would cut shipments by 130,000 bpd from last month.
In January and February, Iraq pumped significantly more oil than an output target established in January when several members of the Organization of the Petroleum Exporting Countries (OPEC) and allies like Russia, a group known as OPEC+, agreed to support the market.
In Saudi Arabia , OPEC’s largest producer, crude exports fell for a second straight month, down to 6.297 million bpd in January from 6.308 million bpd in December.
In Russia, meanwhile, Ukrainian attacks on energy infrastructure have idled around 7 per cent of refining capacity in the first quarter, according to a Reuters analysis.
“The strikes on Russian refineries added $2-$3 per barrel of risk premium to crude last week, which remains in place as we start this week with more attacks over the weekend,” said Vandana Hari, founder of oil market analysis provider Vanda Insights.
Market participants said refinery outages will push Russia to increase oil exports through its western ports in March by almost 200,000 bpd to around 2.15 million bpd.
In China , the world’s biggest oil importer, factory output and retail sales beat expectations in the January-February period, marking a solid start for 2024 and offering some relief to policymakers even as weakness in the property sector remains a drag on the economy and confidence.
China’s crude oil throughput in January and February rose 3 per cent compared to the same two months a year earlier as refineries raised production to meet strong demand for transport fuels over the busy Lunar New Year travel period.
In the world’s biggest economy, the U.S. Federal Reserve (Fed) is widely expected to keep interest rates unchanged when it ends its latest two-day policy meeting on Wednesday.
Stronger-than-expected U.S. economic growth and stickier inflation this year have led investors to push back expectations on the Fed’s first rate cut to June, from May, and reduce bets on how many cuts are likely this year.
Lower interest rates would reduce the cost of buying goods and services, which could boost economic growth and increase oil demand.