Oil prices surged on Friday, driven by positive economic indicators from China and ongoing tensions between Israel and Hamas. Brent futures climbed 0.4% to $84.24 per barrel, while U.S. West Texas Intermediate crude rose 0.5% to $79.64.
The market was buoyed by reports of increased crude oil imports in China in April and speculation of potential interest rate cuts in the U.S. Investors are closely watching for cues on the demand/supply equation from upcoming reports by OPEC, the International Energy Agency, and the U.S. Energy Information Administration.
In April, China’s exports and imports rebounded, signaling a positive shift in demand. San Francisco Federal Reserve President Mary Daly expressed uncertainty about future inflation in the U.S., but markets anticipate a possible easing cycle starting in September.
Meanwhile, tensions between Israel and Hamas escalated as Israeli forces launched airstrikes on Rafah despite warnings from U.S. President Joe Biden. Indirect negotiations in Cairo aimed at halting hostilities in Gaza concluded, but Israel indicated it would continue its military operation.
Overall, the oil market remains volatile as geopolitical tensions and economic indicators drive prices higher. Investors are closely monitoring developments in China, the U.S., and the Middle East for further insights into the future of oil prices.