Oil rose for a third day as a bullish US stocks report fueled a rally led by Saudi Arabia’s warning to short sellers.
West Texas Intermediate futures settled above $74 a barrel, closing Wednesday at the highest level since early May. Saudi Arabia’s energy minister, Prince Abdulaziz bin Salman, told speculators earlier this week to “watch out,” which some interpreted as a sign that OPEC and its allies could be considering another production cut before their meeting next week. Meanwhile, U.S. crude inventories fell by the most since November, a government report showed.
However, the ongoing standoff over debt ceiling talks in Washington, which has weighed heavily on broader financial markets, continues to limit crude’s gains. House Speaker Kevin McCarthy said late Tuesday that the two sides had not yet reached an agreement to avoid a first default.
Despite the recent rally, oil is still down about 7% for the year as traders grapple with China’s post-Covid economic recovery, interest rate hikes by the Federal Reserve and the US debt dilemma. Russian exports have also remained robust, despite promises to cut production in retaliation for Western sanctions.
Prices:
- WTI for July delivery rose 1.43 cents to settle at $74.34 a barrel in New York.
- Brent for the same month gained 1.52 cents to settle at $78.36 a barrel.
