As the week draws to a close, oil markets show signs of stabilizing after two weeks of falling prices. Benchmark Brent crude and US West Texas Intermediate contracts were both higher in early Friday trading. Brent gained half a percent to trade at $89 per barrel, while WTI added similar gains to reach $84.
The moves come as a senior US economic official expressed optimism over upcoming growth data. Treasury Secretary Janet Yellen indicated that preliminary figures showing a slowdown in first quarter expansion may be revised up. She believes underlying momentum in the world's largest economy remains sound. Inflation, which has surged to multi-decade highs, is also expected to moderate soon.
Geopolitical tensions across the Middle East also continue providing underlying support for crude. Ongoing unrest in the Gaza Strip raises supply disruption risks emanating from the volatile region. Any escalation that threatens oil infrastructure could tighten already constricted markets.
With no major catalysts suggesting further selling pressure, traders seem content to hold over the week's end. Barring an unexpected shift, both benchmarks appear set to snap a fortnight-long retreat. A strong start to the monthly oil rally may thus be in the offing if positive economic signals keep emerging.
