Oil Prices Rise Above $4 Per Barrel

Oil prices rose above $4 a barrel on Friday as attention shifted to next week's OPEC+ meeting and expectations that the producer group would increase supply diminished.

Brent crude for September delivery, due Friday, gained $3.29, or 3.1%, to trade at $110.43 a barrel at 11:05 a.m. (1505 GMT), after hitting its highest since July 5. The more active October contract was up $4.42 to $106.25. US West Texas Intermediate (WTI) crude futures rose $4.85, or 5%, to $101.27 a barrel. Both contracts are set for a weekly gain of nearly 7%, while Brent is down 3.8% and WTI 4.2% for July, on track for a second monthly loss. Strong equity markets supported oil on Friday, while a weaker dollar made it cheaper for buyers of other currencies. "There have been a lot of macro influences on the oil market these days, with the stock market having a nice rebound and a similar drop in the dollar feeding (today's prices)," said John Kilduff, partner at Again Capital LLC. Global stocks, which usually move in tandem with oil prices, rose on hopes that disappointing growth figures would encourage the US Federal Reserve to ease monetary tightening. [MKTS/GLOB] A Reuters poll forecasts Brent to average $105.75 a barrel this year, while US crude will average $101.28. [OILPOLL] Front-month Brent futures are selling at an increasing premium to subsequent loading months, a market structure known as backwardation, which signals tightening available supply. "The oil market in Europe is much tighter than in the US and this is reflected in the sharply lower Brent forward curve," Commerzbank (ETR:CBKG) analyst Carsten Fritsch said. Investors will be watching the next meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, together known as OPEC+, on August 3. OPEC+ sources said the group will consider keeping oil production steady for September, while two will discuss a modest increase. A decision not to increase production would disappoint the US after President Joe Biden visited Saudi Arabia this month hoping for a deal to open the taps. Analysts said it would be difficult for OPEC+ to increase supply given that many producers are already struggling to meet production quotas. OPEC+ compliance with their commitments to cut oil production reached 320% in June, Russian Interfax news agency reported, citing a source familiar with the data. The group's total missing oil production amounted to 2.84 million barrels per day last month.