FX.co ★ Crude Oil Surges to Early-August Highs

WTI crude prices surged beyond $65 per barrel on Friday, reaching their highest point since early August and poised for the most significant weekly increase since early June. This upward momentum is attributed to tightening market dynamics driven by supply constraints and heightened demand expectations. The price rally was bolstered by export disruptions and pipeline complications, notably Russia's imposition of a partial diesel export ban announced by Deputy Prime Minister Alexander Novak, as well as an extended ban on gasoline exports. Additionally, OPEC+ is producing only about 75% of its planned output increases, resulting in a deficit of nearly 500,000 barrels per day. Contributing further to this trend, U.S. crude inventories unexpectedly declined, while China's stockpiling activities and consistent demand in energy-intensive sectors boosted future demand prospects. However, these bullish indicators were somewhat mitigated by the resumption of Kurdish exports and lowered expectations for aggressive U.S. interest rate cuts, which moderated the outlook for economic growth and fuel consumption.