(New York) Oil prices ended higher on Tuesday, building on the rise the day before, with analysts banking on a recovery in demand in the summer season, which had already propelled crude prices on Monday.
The price of a barrel of Brent from the North Sea, for delivery in August, gained 1.28%, to $85.33.
Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery in July, climbed 1.54% to $81.57. dollars.
“The market followed the previous day’s rally and there was little major news,” commented Lipow Oil Associates analyst Andy Lipow.
“There is a growing belief that global oil stocks will soon start to fall, which should sustainably support oil prices in the second half of the year” due to “summer season demand,” Tamas told AFP Varga, PVM Energy analyst.
“After the impressive jump” on Monday, prices experienced temporary weakness at the start of the session driven by profit-taking, without starting the current upward trend, Mr. Varga said.
On Monday, the price of Brent had already jumped by 1.97%, while that of WTI had risen by 2.40%.
For Andy Lipow, members of the OPEC alliance continue to “work the market” by maintaining their position on the idea that growth in overall energy demand is good and that production cuts have been effective.
In early June, the Organization of the Petroleum Exporting Countries (OPEC) and its allies within OPEC announced that these reductions, which amount to 2.2 million barrels per day, would gradually disappear starting in October.
But OPEC “has done everything to reassure the market” on the fact that it also leaves itself the possibility of not reintroducing these millions of barrels per day as planned from this fall, if the market is in surplus, noted DNB analysts.
A maritime incident occurred late last week in Singapore, where a tugboat collided with a tanker, causing an oil spill on Sentosa Island, a popular holiday destination.
“This is not an incident that affects production. But Singapore is an important location for oil trading and storage, so there could be some short-term supply disruptions in the region,” Lipow noted.
