Oil steadied below $64 a barrel in New York as ongoing threats to supply from political crises were offset by disappointing indicators on the global economy.
West Texas Intermediate futures gained 12 cents, bringing their gain this week to 0.2 percent. A Purchasing Managers’ Index, which measures private-sector activity in the euro area, unexpectedly slid in April, and German factory numbers came in lower than forecast. Still, an escalating crisis in OPEC nation Libya threatens to add to disruptions in Venezuela and Iran at the same time that other members are deliberately restraining production.
Oil has climbed about 40 percent in New York this year as the Organization of Petroleum Exporting Countries and its allies cut supplies, which have been further squeezed by crises in OPEC members Venezuela and Iran, which are both subject to American sanctions. But the rally has lost steam amid fears about global economic growth, which the International Monetary Fund forecasts will this year be the weakest in a decade.
“Oil bulls are in a dire need for further impetus apart from geopolitical developments that are fully priced in now,” said Tamas Varga, an analyst at PVM Oil Associates Ltd. in London.
WTI for May delivery was 22 cents higher at $63.98 a barrel on the New York Mercantile Exchange as of 12:30 p.m. London time. The contract dropped 29 cents to $63.76 on Wednesday after U.S. data showed a gain in total stockpiles of crude and refined products. Both WTI and Brent won’t trade on Friday due to Easter holidays.
Brent for June settlement gained 19 cents to $71.81 a barrel on the London-based ICE Futures Europe exchange. The contract slipped 10 cents to $71.62 on Wednesday and is on track for a 0.4 percent gain for the week. The global benchmark crude was at a premium of $7.73 to WTI for the same month.
May could be a pivotal month for the market as the U.S. decides whether to extend waivers allowing some countries to keep buying Iranian crude, while a meeting of OPEC and its allies in Saudi Arabia may provide clues on future production levels. Asian buyers of sanctioned Iranian oil are said to be putting purchases on hold as they await the White House’s decision.
“Investors are taking a wait-and-see stance ahead of events in May, including the expiry of waivers on U.S. sanctions on Iran and the OPEC meeting,” said Kei Kobashi, a senior analyst at Sumitomo Corporation Global Research Co. “It will remain difficult to make bets until May because there is so much uncertainty.”
Other oil-market news: Even as OPEC+ starves the global market of heavier crude grades, Russia’s exports are surging. Reliance Industries Ltd. is said to be considering selling as much as 25 percent of its refinery business in a sale that could fetch at least $10 billion. The U.S. Gulf Coast imported the least amount of crude in almost three decades as shipments from Iraq plummeted and congestion lingered on a critical waterway. Libya’s internationally backed prime minister tried to staunch an offensive on the capital, urging strongman Khalifa Haftar’s loyalists to abandon the battle so negotiations could resume.