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Oil prices edged higher on Friday, and were headed for a gain of 2% for the week, driven by tight US supply and expectations of strong fuel demand in China during the Golden Week holiday.
Front-month Brent November futures were up 42c, or 0.44%, to $95.80 per barrel at 0943 GMT, ahead of the contract’s expiry later in the day. The more-liquid Brent December contract was up 33c, or 0.35%, at $93.43 per barrel.
US West Texas Intermediate crude (WTI) gained 51c, or 0.56%, to $92.22 per barrel.
Brent futures touched their highest since November 2022 on Thursday, hitting an intraday peak of $97.69 a barrel. Meanwhile, WTI hit its highest intraday price since August last year at $95.03 a barrel.
A backdrop of tight supplies in the US provided further price support, with storage at Cushing, Oklahoma, the delivery point for US crude futures, already at its lowest since July 2022.
“Any additional decline would threaten to bring them down to a critical level, which could make further withdrawals difficult,” said Commerzbank analyst Carsten Fritsch.
China’s fuel demand was set to firm as the weeklong Golden Week holiday began on Friday.
“(An) increase in international travel during the Golden Week holiday is boosting Chinese oil demand,” ANZ analysts said in a client note.
Domestic travel is also expected to boost demand, with data from flight app Umetrip showing the average number of daily flights booked is a fifth higher than for Golden Week in 2019, before Covid-19.
Meanwhile, inflation in the eurozone fell to a two-year low of 4.3% in September, the latest Eurostat flash reading showed, suggesting the European Central Bank’s policy of steady interest rate hikes was taking effect.
Russia is considering introducing fuel export quotas if the current export ban is not effective in bringing down domestic prices.
“Price increases are unacceptable. If the situation does not change, strict regulatory measures will be taken,” Deputy Prime Minister Alexander Novak said.
