Oil prices rose at the start of trading on Tuesday, continuing their gains for a second day, thanks to hopes of a rise in seasonal demand for fuel and possible US purchases to increase the strategic petroleum reserve, despite the rise in the dollar, which limited the gains.
price movement
By 0038 GMT, Brent crude futures were up 28 cents, or 0.3 percent, at $81.91 a barrel, while U.S. West Texas Intermediate (WTI) crude futures were up 31 cents, or 0.4 percent, at $78.05.
Crude prices rose about 3 percent on Monday to their highest level in a week, supported by expectations of higher fuel demand in the summer despite a stronger dollar and expectations that the Federal Reserve will keep interest rates high for longer.
Hiroyuki Kikukawa, president of NS Trading, said the oil market was supported by expectations of higher fuel demand this summer and the possibility of the United States moving to boost its strategic reserve if U.S. crude remained below $79.
He said that since WTI crude is approaching its 200-day average price, we expect oil prices to remain close to current levels for some time.
U.S. Energy Secretary Jennifer Granholm told Reuters last week that the United States could speed up the rate of replenishment of its strategic petroleum reserve as maintenance work is completed by the end of the year. Washington wants to buy back oil at around $79 a barrel.
Analysts at Goldman Sachs said they expect Brent crude to rise to $86 a barrel in the third quarter, noting that strong transportation demand during the summer will push the oil market into a third-quarter deficit of 1.3 million barrels per day.
