Brent breaks four-week losing streak, heads for a weekly gain

The front-month ICE Brent contract has inched lower by $0.24/bbl on the day, to $76.27/bbl at 09.00 GMT. Futures are set to gain over 3% on the week.

PHOTO: Oil drums on the US flag. Getty Images

Upward pressure:

Both India and the US announced buyback plans to refill emergency oil reserves, and these moves will result in a supply deficit forecast by the International Energy Agency (IEA), says Phil Flynn, senior account executive of The Price Futures Group.

According to the Joint Organisations Data Initiative (JODI), global crude demand surged by a historic 3 million b/d from February to March, Flynn notes.

JODI is a collaboration of six international energy agencies, including the IEA and OPEC, that gathers oil production and consumption data from 114 countries – that account for 90% of the world's supply and demand.

In the US, three lawmakers have proposed a bill to reimpose a ban on US crude exports, according to US Senator Edward Markey.

America is the largest supplier of crude oil to the EU since the latter banned Russian seaborne crude oil imports. A ban on US oil exports would create a significant supply gap in the European bloc. This could lead to a surge in demand for OPEC oil and boost Brent crude's price in the long term.

Downward pressure:

Brent continues to trade in a lower range from where it stood before the banking sector turmoil began, says Craig Erlam, senior market analyst at OANDA.

“Better economic expectations or another OPEC+ intervention will likely be needed in order to lift oil prices back into that December to March range and neither looks likely over the next couple of weeks,” Erlam adds.

By Konica Bhatt

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