Oil Prices Rise, Traders Turn To OPEC+ Allies Led By Russia

JAKARTA - Oil prices rose by more than two US dollars in late trading Friday (Saturday morning WIB), July 30, when market attention turned to next week's OPEC+ meeting and dimmed expectations that the producer group will soon increase supply.

US West Texas Intermediate (WTI) crude futures for September delivery added 2.2 dollars, or 2.3 percent, to settle at 98.62 dollars a barrel on the New York Mercantile Exchange.

Brent crude futures for September delivery rose 2.87 dollars, or 2.7 percent, to close at 110.01 dollars a barrel on the London ICE Futures Exchange.

For the week, U.S. crude standards and Brent jumped 4.1 percent and 6.6 percent, respectively, based on front-month contracts. However, both contracts recorded their second monthly losses, with Brent down around 4.0 percent for July and WTI nearly 7.0 lower.

Traders turned their eyes to the Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, collectively known as OPEC+, as the group is expected to meet next week to discuss future production strategies.

An OPEC+ source said the group would consider keeping oil output unchanged for September with the two saying a moderate increase would be discussed.

The decision not to increase production will disappoint the United States after President Joe Biden visited Saudi Arabia this month in hopes of a deal to increase production.

Oil prices pared some gains after the release of data from oil services firm Baker Hughes showing that US drillers added crude rigs for a record 23 months in a row, indicating more supply ahead.

In July, the number of oil rigs rose by 11, increasing for a record 23 consecutive months, while gas counts were unchanged after rising for the 10th month in a row, Baker Hughes data showed.

A stronger stock market also supports oil, as does a weaker dollar, which makes oil cheaper for buyers in other currencies.

"Lately, there's been a lot of macro leverage in the oil market with the stock market making a nice rebound and a similar drop in the dollar affecting (today's prices)," said John Kilduff, partner at Again Capital LLC.