Oil rose on Friday and was headed for a second consecutive weekly gain supported by OPEC+’s decision to make its largest supply cut since 2020 despite concern about recession and rising interest rates.
The cut from the Organization of Petroleum Exporting Countries and allies including Russia, known as OPEC+, comes ahead of a European Union embargo on Russian oil and will squeeze supply in an already tight market.
Brent crude was up 33 cents, or 0.4 per cent, to $94.75 a barrel while U.S. West Texas Intermediate or WTI crude also gained 33 cents, or 0.4 per cent, to $88.78.
Both benchmarks were heading for a second weekly gain, with that of Brent approaching 8 per cent this week. The global benchmark is still down sharply after coming close to its all-time high of $147 a barrel in March after Russia invaded Ukraine.
A stronger U.S. dollar ahead of Friday’s U.S. jobs report, and comments from Federal Reserve policy-makers signalling further aggressive policy tightening limited the rally.
Dollar strength makes oil more expensive for other currency holders and tends to weigh on oil and other risk assets.