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Brent crude: Oil rises as dollar strength eases, but Fed weighs

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Brent crude: Oil rises as dollar strength eases, but Fed weighs

Oil prices rose on Monday, supported by a slightly weaker dollar and a stronger stock market in a session that oscillated between supply concerns and expectations that higher U.S. interest rates would dent fuel demand.

Brent crude futures for September settlement rose 68 cents, or 0.66%, to $103.88 a barrel at 1402 GMT, while U.S. West Texas Intermediate (WTI) crude futures rose 85 cents Or 0.9 percent, to $95.55 a barrel.

UBS oil analyst Giovanni Staunovo said on Monday: “A slight weakening in the dollar and improving equities are supporting oil.”

Oil futures have been volatile in recent weeks as traders try to reconcile the possibility of further interest rate hikes, which could limit economic activity and thus lower fuel demand growth, while supplies are tight due to disruptions in Russian crude trading due to Western sanctions. Ukraine conflict.

Jeffrey Halley, senior market analyst at OANDA, said: “The heightened fears of a recession around the world do suggest that near-term earnings may be limited, with the exception of geopolitics.”

Fed officials said the central bank may raise interest rates by 75 basis points at its July 26-27 meeting.

China, the world’s second-largest economy, barely contracted in the second quarter, growing just 0.4% year-on-year.

But the sharp rise in front-month premiums compared to the second month continues to point to near-term supply constraints. The spread closed at $4.82 a barrel on Friday, hitting a new all-time high after excluding spikes related to expiry in the previous two months.

Libya’s National Oil Company (NOC) said it aimed to restore production from around 860,000 bpd to 1.2 million bpd within two weeks.

But analysts expect output in Libya to remain volatile as post-conflict tensions between rival political factions remain high over the weekend.

Commodities chief Warren Patterson said that amid continued supply constraints, “Russian oil supplies are expected to decline slightly in the coming months, as the widely anticipated plan to cap Russia’s oil prices could have the opposite effect on oil prices. Influence” ING’s strategy.

The European Union said last week that it would allow Russian state-owned companies to ship oil to third countries under an adjustment in sanctions agreed by member states last week aimed at limiting risks to global energy security.

However, Russia’s central bank governor Elvira Nabiullina said on Friday that Russia will not supply oil to countries that decide to impose a price cap on its oil.

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