RIYADH: Oil prices increased moderately on Friday as hopes of stronger Chinese demand and a weakening US dollar outweighed concerns about a global economic downturn and the impact of interest rate rises on fuel use.
To fight inflation, the US Federal Reserve is trying to slow the economy and will keep raising its short-term rate target, Federal Reserve Bank of Philadelphia President Patrick Harker said on Thursday in comments that weighed on oil.
Brent crude is currently priced at $93.50 a barrel, up $1.12 or 1.2 percent.
US West Texas Intermediate crude settled at $85.05 a barrel, up 54 cents, 0.6 percent.
Moldova frets over Gazprom stance
Moldova’s pro-Western government on Friday complained Russia’s Gazprom was not behaving like a serious partner, given its refusal to tell Chisinau how much natural gas it would provide in November.
One of Europe’s poorest countries, Moldova is reliant on Russian gas and has been struck by a surge in prices since Russia’s invasion of Ukraine. Moldova’s contract with Gazprom fluctuates monthly based on the spot market price of gas and oil.
Deputy Prime Minister Andrei Spinu said he had asked Gazprom Export Head Elena Burmistrova how much gas Moldova would receive in November, and she had replied, “We’ll see.”
Gazprom has already cut October supplies by 30 percent and said it could shut off the gas entirely unless Moldova pays all its debts to the company.
“Gazprom says it is a serious partner, but serious partners don’t behave the way it is behaving toward Moldova,” Spinu told the NewsMaker online news service.
“I don’t understand what Gazprom’s motives are for cutting the gas supply. We have a contract, and we are ready to pay for gas,” he said.
US oil and gas rigs rise for the second week in a row
US energy firms this week added oil and natural gas rigs for the second week as relatively high oil prices encourage firms to drill more.
The oil and gas rig count, an early indicator of future output, rose from two to 771 in the week ending Oct. 21, its highest since March 2020, energy services firm Baker Hughes Co. said in its closely followed report on Friday.
Baker Hughes said that puts the total rig count up 229, or 42 percent, over this time last year.
US oil rigs rose from two to 612 this week, their highest since March 2020, while gas rigs were unchanged at 157.
Even as the rig count mostly increased over the past two years, weekly increases have been in the single digits for months.
Moreover, oil production remained below record levels before the pandemic as many companies focused more on returning money to investors and paying down debt rather than boosting output.
(With input from Reuters)