Oil prices edge higher as tighter supply bets offset rate hike fears
Investing.com-- Oil prices rose slightly in Asian trade on Friday as growing expectations of tighter supplies helped markets look past concerns over rising interest rates, which had battered prices this week.
Crude prices were still set to end the week lower as fears of higher interest rates in the developed world spurred a heavy dose of profit taking. The Federal Reserve warned that interest rates will remain higher for longer through 2024, as did the Bank of England and the European Central Bank.
But this was somewhat offset by a fuel export ban from Russia, which heralds even tighter global supplies in the coming weeks. The export ban comes on the heels of deeper-than-expected supply cuts from Russia and Saudi Arabia, which were the key drivers of an oil rally this year.
Brent oil futures rose 0.3% to $93.52 a barrel, while West Texas Intermediate crude futures rose 0.3% to $89.89 a barrel by 21:05 ET (01:05 GMT). Both contracts were set to lose between 0.6% and 1.3% for the week.
The prospect of tighter supplies still kept oil prices trading relatively higher for the year. A combined 1.3 million barrels per day cut from Russia and Saudi Arabia is set to substantially limit oil supplies in the coming months.
Brent oil- the global benchmark- is expected to trend between $90 to $100 a barrel through the remainder of 2023.
A fuel export ban by Russia on Thursday added to expectations of tighter supply, after Moscow blocked fuel shipments to most countries beyond four ex-Soviet states with immediate effect.
Inventory data released earlier this week also showed U.S. supplies remained tight, even with the end of the travel-heavy summer season.
But oil markets were hit particularly hard by hawkish signals from the
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