Sign up now for FREE unlimited access to Reuters.com Register SINGAPORE, July 18 (Reuters) – Oil prices extended gains on Monday, supported by a weaker dollar and tight supplies that offset recession worries and the prospect of extended COVID-19 restrictions in China, again dampening fuel demand. Brent crude futures for September settlement were up $2.54, or 2.5%, at $103.70 a barrel by 0648 GMT, after rising 2.1% on Friday. U.S. West Texas Intermediate (WTI) crude futures for August delivery rose $2.31, or 2.4%, to $99.90 a barrel, after rising 1.9% in the previous session. Sign up now for FREE unlimited access to Reuters.com Register The US dollar Last week, Brent and WTI posted their biggest weekly declines in about a month on fears of a recession hitting oil demand. Mass COVID-testing exercises continued in parts of China this week, raising concerns about oil demand in the world’s second-largest oil consumer. read more However, oil supplies remained tight, supporting prices. As expected, US President Joe Biden’s trip to Saudi Arabia failed to deliver on any promises from OPEC’s top producer to boost oil supply. read more Biden wants Gulf oil producers to ramp up production to help lower oil prices and reduce inflation. On Sunday, Amos Hochstein, the US State Department’s senior energy security adviser, told CBS’ Face the Nation that the trip would result in oil producers taking “a few more steps” on supply, though he did not say which country or countries would boost production. read more “While there have been no immediate commitments to increase oil production, the US has reportedly indicated an expected gradual increase in supply,” Baden Moore, head of commodities research at National Australia Bank, said in a note. “The removal of SPR releases from November may offset this incremental supply if not by more than about 1 million barrels per day.” The next meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, together known as OPEC+, on August 3 will be closely watched as their existing production pact expires in September. Global markets are focused this week on the resumption of Russian gas flows to Europe via the Nord Stream 1 pipeline, which is scheduled to end maintenance on July 21. Governments, markets and companies fear the shutdown could be extended due to the war in Ukraine. read more “Brent crude will find support at the end of the week if Russia does not return gas to Germany after Nord Stream 1 maintenance,” said OANDA senior analyst Jeffrey Haley. The loss of that natural gas would hit Germany, the world’s fourth-largest economy, hard and raise the risk of a recession. Separately, U.S. Treasury Secretary Janet Yellen said on Saturday she had productive meetings on a proposed price cap for Russian oil with a number of countries on the sidelines of a meeting of Group of 20 economic chiefs. read more Yellen raised the price cap idea during a virtual meeting on July 5 with Chinese Vice Premier Liu He, China’s commerce ministry said last week. The ministry said that setting a ceiling on the price of Russian oil is a “very complicated issue” and the condition for resolving the crisis in Ukraine is to promote peace talks between the parties involved. read more Sign up now for FREE unlimited access to Reuters.com Register Reporting by Sonali Paul in Melbourne and Florence Tan in Singapore. Editor: Christian Schmollinger Our Standards: The Thomson Reuters Trust Principles.
