Oil prices are trending upwards, posting a weekly increase on Friday after suffering losses for two consecutive weeks, fueled by optimism regarding rising energy demand in China and a weak dollar. Brent crude futures rose by 0.3% to $75.87 per barrel, while West Texas Intermediate crude futures increased by 0.2%. Both benchmarks gained nearly 3% during the previous session.
Analysts anticipate that prices will receive support from voluntary crude production cuts by the Organization of the Petroleum Exporting Countries (OPEC) and its allies since May, along with Saudi cuts in July.
However, weak economic forecasts are casting a shadow over market sentiment, as growth in China's industrial output and retail sales fell short of expectations in May. Edward Moya, an analyst at OANDA, noted in a memo: "Crude prices are seeking support as global growth forecasts remain vulnerable to further shocks from interest rate hikes."
High interest rates lead to increased borrowing costs, which may slow economic growth and reduce oil demand.
