Oil futures rose on Friday on course for a fourth weekly gain boosted by supply constraints and a weaker dollar and despite sources saying China is set to release crude reserves around the Lunar New Year.
Brent crude futures rose $1.16, or 1.4 per cent, to a two-and-a-half month high of $85.63 a barrel at 1125 GMT. US West Texas Intermediate crude gained $1.06, or 1.3 per cent, to $83.18.
Crude prices turned positive as the dollar headed towards what could be its largest weekly fall in more than a year. A weaker dollar makes commodities more affordable for holders of other currencies.
Several banks have forecast oil prices of $100 a barrel this year, with demand expected to outstrip supply, not least as capacity constraints among Opec+ countries come into focus.
“When you consider that Opec+ is still nowhere near pumping to its overall quota, this narrowing cushion could turn out to be the most bullish factor for oil prices over the coming months," said PVM analyst Stephen Brennock.
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