MOSCOW (MRC) -- Oil extended gains on Friday, with Brent topping USD72 a barrel for the first time since 2019, as OPEC+ supply discipline and recovering demand countered concerns about a patchy COVID-19 vaccination rollout around the globe, reported Reuters.
The Organization of the Petroleum Exporting Countries and allies on Tuesday said they would stick to agreed supply restraints. A weekly supply report on Thursday showed U.S. crude inventories dropped more than expected last week.
Oil extended gains after US figures showed nonfarm payrolls increased by 559,000 jobs last month. The US dollar weakened after the report, making oil cheaper for holders of other currencies and lending support to oil prices.
Brent crude rose 58 cents, or 0.8%, to settle at USD71.89 a barrel, after touching USD72.17, its highest since May 2019. US West Texas Intermediate crude rose 81 cents, or 1.2%, to settle at USD69.62. The session high was USD69.76, its highest since October 2018.
Oil prices drifted higher after US energy firms last week cut the number of oil and natural gas rigs operating, for the first time in six weeks, data from energy services firm Baker Hughes showed. Brent rose about 3% on the week while US crude notched gains of nearly 5%. It is the second week of gains for both contracts.
Also boosting oil last week was a slowdown in talks between the United States and Iran over Tehran's nuclear programme, which reduced expectations of a return of Iranian oil supply.
"Energy markets are locked in on Iran nuclear talks that should pick up next week," Edward Moya, senior market analyst at OANDA said.
"The fifth round of negotiations will heat up next week and that should keep oil prices supported as Tehran will stick to their red lines for restoring the nuclear deal."
As MRC wrote earlier, Indian refiners, anticipating a lifting of US sanctions, plan to make space for the resumption of Iranian imports by reducing spot crude oil purchases in the second half of the year. The world"s third-largest oil consumer and importer halted imports from Tehran in 2019 after former US President Donald Trump withdrew from a 2015 accord and re-imposed sanctions on the OPEC producer over its disputed nuclear programme.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.