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Oil steady amid rosier outlook for global economy, strong fuel demand

Brent crude was down 2 cents at $83.41 a barrel by 0735 GMT, after gaining 0.8% on Monday

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Brent crude oil | Exports

Reuters  |  TOKYO 

(Photo: Bloomberg)
(Photo: Bloomberg)

By Aaron Sheldrick

TOKYO (Reuters) - Oil prices were steady on Tuesday after two straight sessions of gains as the passage of a U.S. infrastructure bill, strong Chinese and the global post-pandemic recovery lifted the outlook for fuel demand.

Brent crude was down 2 cents at $83.41 a barrel by 0735 GMT, after gaining 0.8% on Monday. U.S. oil was up 3 cents at $81.96 a barrel, also after a 0.8% gain the previous day.

U.S. President Joe Biden's long-delayed $1 trillion infrastructure bill - which passed through Congress at the weekend - and better-than-expected Chinese helped paint a picture of a more expansive global

"The big unknown is whether economies can achieve growth amid the current high price environment, or potentially in an even higher price scenario," said Rystad Energy senior oil markets analyst Louise Dickson.

JPMorgan Chase commodities analysts said global demand for oil in November was already nearly back to pre-pandemic levels of 100 million barrels per day (bpd).

"More consumption growth lies in wait once travel begins in earnest and jet fuel demand picks up,"

But as major producers maintained strict supply discipline in October, oil prices rose to seven-year highs, with fuel values also rising.

Biden, though, may take measures as early as this week to address soaring gasoline prices, Energy Secretary Jennifer Granholm said on Monday.

"He's certainly looking at what options he has in the limited range of tools a president might have to address the cost of gasoline at the pump, because it is a global market," Granholm told MSNBC in an interview.

Despite the tighter market, U.S. crude inventories are expected to have risen a third straight week, a Reuters polls showed, possibly helping to cap further gains.

"If the U.S. doesn't get OPEC+ to respond to its pledge for more output, it has its own arsenal of tools to deploy to battle high prices of refined oil products," Dickson said.

 

(Reporting by Aaron Sheldrick; Editing by Tom Hogue, Michael Perry and Kim Coghill)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Tue, November 09 2021. 14:03 IST
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