Oil prices recovered Friday morning after dipping marginally at the previous session with Brent crude inching near to the $30 mark.
Prices had dropped on Thursday as global supply and demand fears reversed earlier gains seen from an increase in Saudi Arabia’s official crude selling price and a shock increase in Chinese exports in April.
Brent, the benchmark for Nigeria’s oil grades, gained 44 cents or 1.49% to stand at $29.90 per barrel as of 07:08 West African Time.
U.S. West Texas Intermediate was up by 46 cents or 1.95%, rising to $24.01 a barrel.
Nigeria’s Bonny Light added up $2.30 or 10.16% at Thursday’s trade to close at $24.93 per barrel, according to oilprice.com.
The two benchmarks have rallied steeply this week as a result of easing of coronavirus lockdowns in many countries, triggering a modest rebound in fuel demand.
Similarly, oil production across the world is declining to reduce the saturation in the market.
U.S. crude inventories at the Cushing storage hub in Oklahoma rose by nearly 407,000 barrels in one week to 5th May, said traders citing Genscape data.
Analysts at Rystad Energy forecast that global oil demand would fall by 10.9% this year to 88.7 million barrels per day (bpd) from around 99.5 million bpd in 2019.
The energy consultant had earlier estimated that demand would average 88.8 million bpd next year.
Saudi Arabia upped its official selling price for June after reducing May exports to almost the lowest in a decade following an agreement by global oil producers to cut output in order to prop up prices.
“It is … likely seen as a strong indication that the Kingdom will follow through on its pledged supply cuts agreed at the 12 April OPEC+ emergency meeting,” said Harry Tchilinguirian, Head, Commodity Research at BNP Paribas.