(Bloomberg) — Oil was on track for a weekly gain as market gauges continued to show signs of strength, with OPEC+ set to decide early this month whether to extend supply cuts into the next quarter.
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West Texas Intermediate futures held above $78 a barrel, and were up over 2% for the week. Brent closed below $82 on Thursday. Prompt spreads for both benchmarks expanded in a bullish backwardation structure last month, an indication of tightening physical crude markets.
Oil capped a second monthly increase in February, although prices remain in a tight trading range. Geopolitical tensions including the Israel-Hamas war have helped spur some of the gains, but rising non-OPEC supply and persistent concerns about Chinese demand have kept futures from rallying.
Meanwhile, expectations that the US will hold interest rates steady for longer were bolstered when the Federal Reserve’s preferred inflation gauge rose by the fastest pace in nearly a year. That’s likely a headwind for wider energy demand, which hurts commodities including crude.
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