August 9,2022

The various crude oil grades were sold at higher prices on Monday as positive economic data from China and the United States displaced nagging fears of a recession.

At the market yesterday, the Brent crude futures gained $1.73 or 1.8 per cent to settle at $96.65 per barrel as the US West Texas Intermediate (WTI) crude futures appreciated by $1.75 or 1.97 per cent to sell at $90.76 a barrel.

Last week, fears that a recession could dent energy demand pushed Brent prices to their lowest since the Russian invasion of Ukraine in February

But the market was boosted at the opening session after job growth in the US, the world’s top oil consumer, unexpectedly accelerated in July.

In China, positive data surprised markets with faster-than-expected growth in exports.

The world’s top crude importer brought in 8.79 million barrels per day of crude in July, up from a four-year low in June, but still 9.5 per cent less than a year earlier, Chinese customs data showed.

In Europe, Russian crude and oil product exports continued to flow ahead of an impending embargo from the European Union (EU) from December 5.

Analysts at Goldman Sachs said they believe the case for higher oil prices remains strong, with the market in a larger deficit than they expected in recent months.

Meanwhile, pressure came as the EU late on Monday put forward a “final” text to revive the 2015 Iran nuclear deal, awaiting approvals from the US and Iran.

A senior EU official said a final decision on the proposal was expected within “very, very few weeks”

The final draft, submitted by European officials, must be signed by both US President Joe Biden and Iranian President Ebrahim Raisi in the coming weeks when the deadline for talks expires.

The original 2015 nuclear deal, signed by Iran with the US, France, Germany, Britain, Russia and China, was abandoned by former US President Donald Trump in 2018. In the nearly four years since Iran is said to have significantly ramped up its nuclear activities

The final draft delivered by the EU officials could lead to a significant expansion of Iranian oil exports, but officials involved in the talks say that major sticking points remain.