Oil prices steady near 3-month highs

Oil prices were steady on Tuesday, hovering near three-month highs as signs of tighter supplies and pledges by Chinese authorities to shore up the world’s second-biggest economy lifted sentiment, while weaker Western economic data weighed.

Brent futures were down 4 cents, or 0.05%, at $82.70 a barrel, while U.S. West Texas Intermediate (WTI) crude was stable at $78.74.

The crude benchmarks are on track for their fifth weekly gain in a row, with supplies expected to tighten due to output cuts from the Organization of the Petroleum Exporting Countries (OPEC) and allies.

Earlier-loading Brent contracts are selling above later loadings, a price structure known as backwardation indicating traders see tight supply, with the six-month spread near a two-and-a-half month high.

Industry data on U.S. crude inventories is expected at around 2030 GMT. Four analysts polled by Reuters estimated on average that crude inventories fell by about 2 million barrels in the week to July 21.

In China, the world’s second-largest economy and second-biggest oil consumer, leaders pledged to step up economic policy support.

Business activity in the euro zone shrank more than expected in July, a survey showed.

In the U.S., business activity slowed to a five-month low in July, a closely watched survey showed, but falling input prices and slower hiring indicate the Federal Reserve could be making progress on its bid to reduce inflation.

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