Brent Crude, which Nigeria’s oil is benchmarked against, hits $78 per barrel on Monday as the global demand improves following ease in COVI-19 restrictions.
International benchmark Brent crude was trading at $78.14 per barrel afternoon after rising by 1.17 percent from $77.23 a barrel on Friday.
American benchmark West Texas Intermediate (WTI) was at $74.83 per barrel at the same time for a 1.14% increase after it ended the previous session at $73.98 a barrel.
India’s oil imports hit a three-month peak in August, rebounding from nearly one-year lows touched in July, as refiners in the second-biggest importer of crude stocked up in anticipation of higher demand.
In China, economic activity has started on a new note with Beijing monitoring development around the covid-19 virus and its variant closely.
Last week, the United States of America recorded a massive drawdown in stockpiles, as the Organisation of Petroleum Exporting Countries and allies (OPEC+) stated that there is no going back on its planned gradual incremental, which started in August.
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According to market data, oil prices have been on the rise for the fifth consecutive week with Brent hitting the highest level since October 2018 at $78.64 a barrel early Monday.
A tightening market is mostly driving the price increases, as US inventories are now close to three-year lows, while the easing of pandemic restrictions is improving the oil demand outlook. Rising natural gas prices are also contributing to the uptick in oil demand, with oil now cheaper than gas.
The US oil rig count, an indicator of short-term production in the country, rose last week, according to the latest data released by oilfield services company Baker Hughes on Friday.
The number of oil rigs increased by 10 to 421 for the week ending Sept. 24 from 411 the previous week. On an annual basis, the oil rig count rose by 238 this year.
Goldman Sachs raised by $10 its forecast for Brent crude at the end of this year to $90 per barrel, as faster fuel demand recovery from the outbreak of the Delta variant of the coronavirus and Hurricane Ida’s hit to U.S. production led to tight global supplies.
“While we have long held a bullish oil view, the current global supply-demand deficit is larger than we expected, with the recovery in global demand from the Delta impact even faster than our above-consensus forecast and with global supply remaining short of our below consensus forecasts,” Goldman said.
