04-04-2024 09:03 AM | Source: Reuters
Oil prices rise on concerns of lower supply, signs of U.S. economic growth

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Oil prices rose in early Asian trade on Thursday on concerns of lower supply as major producers are keeping output cuts in place and on signs of stronger economic growth in the U.S., the world's biggest oil consumer.

Brent futures for June rose 15 cents, or 0.2%, to settle at $89.51 a barrel at 0037 GMT. U.S. West Texas Intermediate (WTI) futures for May rose 15 cents, or 0.2%, to $85.59 a barrel.

Both the June Brent contract and the May WTI contract have risen for the past four days and closed on Wednesday at the highest since the end of October.

Oil has gained as Ukraine's attacks on Russian refineries have cut fuel supply and amid concerns that the Israel-Hamas war in Gaza may spread to include Iran, possibly disrupting supplies in the key Middle East region.

A meeting of top ministers from the Organization of Petroleum Exporting Countries (OPEC) and its allies including Russia, kept oil supply policy unchanged on Wednesday and pressed some countries to boost compliance with output cuts.

The group said some members would compensate for oversupply in the first quarter. It also said Russia would switch to output rather than export curbs.

Also on Wednesday, Federal Reserve Chair Jerome Powell was cautious about future interest rate cuts because of recent data showing higher-than-expected job growth and inflation.

The comments were positive for oil because they indicated solid U.S. economic growth, said Rob Haworth, senior investment strategist for U.S. Bank's asset management group.

In the Middle East, Iran has vowed revenge against Israel for an attack on Monday that killed high-ranking Iranian military personnel. Iran is the third-largest producer in OPEC.