Summary:
Oil prices rose Friday due to the US Treasury secretary's comments on the economy's strength and potential supply disruption in the Middle East.
Oil prices rose on Friday due to the US Treasury secretary’s comments that economy is likely in a stronger position than indicated by weak Q1 data and potential supply disruption in the Middle East.
Yellen said the data could be revised higher, and inflation will ease to more normal levels after a clutch of "peculiar" factors held the economy to its worst performance in nearly two years.
Meanwhile, Israel stepped up airstrikes on Rafah after saying it would evacuate civilians from the southern Gazan city and launch an all-out assault on Hamas.
Perceived de-escalation between Iran and Israel could knock off $5-10 down of oil prices in coming months, Goldman Sachs analysts said in a note. They forecast Brent crude has peaked at $90.
US crude stockpiles fell by 6.4 million barrels in the week ended 19 April, according to the EIA, compared with analysts' expectations in a Reuters poll for a gain of 825,000 barrels.
But the IMF expects OPEC and its partners to start increasing oil production gradually from July. It said Riyadh may require an average of $96.20 to balance its budget, assuming it holds output steady.
Brent crude has regained stability by rising back above the ascending channel. There's still potential for a retest of $90, but this depends on whether the price action breaks the 50-day Moving Average.
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