Oil Prices Coast to 5th Straight Monthly Gain in April

NEW YORK (Sputnik) - Crude prices coasted to a fifth straight month of gains as concerns over Russian oil disruption offset downside brought by China’s newest COVID-19-related crisis.

Analysts said prices could climb further ahead of next week’s OPEC+ meeting, where producer indifference to increasing output could prompt a barrel to test highs of $115 and above.

Brent crude, the London-traded global benchmark for oil, settled Friday’s trade up $1.75, or 1.6%, at $109.34 per barrel.

For the week, Brent rose 2.5% and for the month, it rose 1.3%. While the monthly gain was Brent’s smallest since December, it ensured an unbroken winning streak over the past five months for the global crude benchmark which netted 55% in that stretch.

In New York, the West Texas Intermediate, or WTI, benchmark for US crude settled down 67 cents, or 0.6%, at $104.69 per barrel.

For the week, WTI rose almost 2% and for the month, it was up 4.4%. Similar to Brent, WTI has gained every month since the end of November, accumulating a windfall of 58% over the past five months.

Oil began this week on a dark note, as a two-day selloff from last week extended into Monday on worries about China’s COVID-19 situation and about the dollar at 2020 highs that made crude and other commodities more expensive for non-holders of the US currency.

But in three sessions from Tuesday, crude prices reversed from their weakness on concerns over tight supply. Reports on Thursday that Germany will likely lead the European Union in banning Russian oil heightened the rally, as traders vexed over more supply disruptions in already-stressed global energy markets.

Some 35% of Germany’s oil imports came from Russia before the start of the Ukraine conflict and the ensuing Western sanctions against Moscow. Some EU nations, meanwhile, sourced almost every drop of their oil from Russia once.

“If Europe is suddenly required to look for huge amounts of gas or oil supplies in international markets, that will offset China’s slowdown fears and send prices higher,” Jeffrey Halley, a senior market analyst at online trading site OANDA, said.

With OPEC+ due to hold its monthly conference on May 4, oil’s upward momentum could hold for another week at least, analysts said.

OPEC+, led by the 13-member Saudi-controlled Organization of Petroleum Exporting Countries and ten other oil producers steered by Russia, has pushed prices up each time it met over the past year by offering 400,000 barrels per day hike in monthly output - and then struggling to fulfill the raise in production.