Oil Extends Gain for a Second Session Ahead of US Inflation Data

West Texas Intermediate climbed above $76 a barrel after closing almost 2% higher in the previous session. Investors will be watching personal spending data later Friday for clues on the path forward for interest rates. Minutes from the Federal Reserve this week signaled more hikes to come.

Oil prices have been whipsawed this year by bullish optimism around China’s rebound following the end of Covid Zero and persistent concerns over a US economic slowdown. Wall Street banks are starting to temper their outlook for crude prices, with UBS Group AG and Morgan Stanley the latest to trim forecasts.

“Despite the fears over higher interest rates crimping oil demand, oil markets are on track to swing into a deficit as Chinese demand recovers and additional Russian output is shut in,” said Stephen Brennock, an analyst at brokerage PVM Oil Associates Ltd. “Bullish catalysts may be playing second fiddle to monetary policy concerns, but they will soon draw the attention of traders.”

Prices:

• WTI for April delivery rose 1.2% to $76.31 a barrel as of 10:18 a.m. London time.
• Brent for April settlement gained 1.3% to $83.25 a barrel.