US crude jumps 3% in the week – Brent hits $100 again

Oil prices ended Friday’s session with gains, extending their upward trend for the week.

The prospect of OPEC+ cutting output outweighed worries about a recessionary economy and fears of a drop in oil demand, although the latter were boosted by Federal Reserve Chairman Jerome Powell’s speech at the Jackson Hole conference, signaling that a further aggressive rate hike is likely as the Fed tries to tame inflation.

In particular, the chairman of the Federal Reserve reiterated his commitment to contain inflation, warning that he expects the US central bank to continue raising interest rates in a way that will cause “strain” on the country’s economy.

Powell stressed that the Fed will continue the fight against inflation “until the job is done” and to that end “will use its tools vigorously.” “While higher interest rates, slower growth and softer labor market conditions will reduce inflation, they will also bring pain to households and businesses,” he said.

“High interest rates will certainly reduce economic activity and oil consumption is no exception,” said Manish Raj, chief financial officer at Velandera Energy Partners.

However, oil prices found support on hopes of a deal on Iran’s nuclear program, a development that could put barrels of Iranian crude back on the market, offsetting possible output cuts by Saudi Arabia.

“Sources close to OPEC+ indicate that a production cut would only happen if Iran returned to the oil market as a result of a new nuclear deal. However, there is an impression that Saudi Arabia is not willing to tolerate a price slide below $90,” Commerzbank analysts said in a note.

In this climate, the slow press West Texas Intermediate delivery he won on Friday 54 cents or 0.6%to set its price at $93.06 per barrel. In the weekWTI noted “jump” 2.9%according to Dow Jones Market Data.

The October oil press contract Brent settled at $100.99 a barrel, up $1.65 or 1.7%and to weekly basis recorded an increase of 4.4%.