Oil extends weekly gain as traders look for clues on economy

Image: Bonterra

Oil extended a weekly gain, with investors awaiting further economic data as the fallout from the banking crisis continued to ripple across markets.

West Texas Intermediate futures edged toward $70/bbl after climbing almost four per cent last week. As the bank-sector turmoil sparks recessionary fears, U.S. authorities are considering expanding an emergency lending facility — among several options on the table.

WTI for May delivery rose 0.7 per cent to $69.74/bbl at 11:02 a.m. London time. Brent for May settlement also increased 0.7 per cent to trade at $75.50/bbl.

Oil remains on track for its steepest first-quarter loss since 2020 as a potential U.S. recession, French strikes and resilient Russian output weigh on the outlook. In the days ahead, traders will look to Federal Reserve officials for clues on the path forward for monetary policy, and a key measure of U.S. inflation is due.

The “focus returns to important economic figures due over the coming weeks,” including jobs data, said Jens Naervig Pedersen, an analyst at Danske Bank A/S. Investors want signals on “how the economy is doing and ultimately the strength of oil demand.”

© 2023 Bloomberg L.P.

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