Oil prices have returned to highs seen in early April as demand for crude picks up and China increases its refining activity.
West Texas Intermediate (WTI) oil was up 65 cents, or 2.36%, at $28.21 a barrel on Friday after reaching $28.75, its highest level since early April. WTI jumped 9% in the previous trading session. Brent crude was up 81 cents, or 2.6% at $31.94 a barrel, after touching $32.50 the highest level since April 13. Brent rose nearly 7% on Thursday.
Both WTI and Brent crude are on track for a third consecutive week of gains.
Along with supply cuts by the Organization of the Petroleum Exporting Countries (OPEC) and other major producers, bright spots are also emerging on the demand side. Data released on Friday showed China’s daily crude oil use rebounded in April as refineries ramped up operations.
The International Energy Agency (IEA) said in a note this week that it expects global crude inventories to fall by about 5.5 million barrels per day in the second half of this year. It also expects oil demand this year to fall by 8.6 million bpd, which is a smaller decline in 2020 – by 690,000 bpd – than it forecast last month. It expects non-OPEC supply to fall by 3.2 million bpd.