Oil Posts Second Weekly Gain as Debt-Limit Deal Inches Closer

By Bloomberg

May 26, 2023

image is BloomburgMedia_RV8L22DWX2PS01_28-05-2023_06-25-51_638208288000000000.jpg

Oil storage tanks in the Keihin industrial area in Yokohama, Kanagawa Prefecture, Japan, on Monday, April 10, 2023. Saudi Arabia hiked official selling prices for all of its oil sales to Asian customers in May, days after the kingdom led a surprise OPEC+ output cut. Photographer: Toru Hanai/Bloomberg

Oil rose a second consecutive week as investors monitored progress made Friday on debt-ceiling talks to avoid a US default.

Republican and White House negotiators were moving closer to an agreement to raise the debt limit, according to people familiar with the matter. Still, the agreed-upon details are tentative, and a final accord isn’t in hand. 

Supply dynamics remain in focus, with Saudi Arabia and Russia offering conflicting statements on the potential for more cuts from OPEC and its allies. Russian Deputy Prime Minister Alexander Novak said that OPEC+ wasn’t likely to take further measures at its gathering in Vienna in June, contrasting with Saudi Energy Minister Prince Abdulaziz bin Salman’s remarks earlier in the week that speculators should “watch out.”


Crude has still sunk almost 10% this year amid the lackluster economic recovery in top importer China and the aggressive monetary tightening campaign by the US Federal Reserve. More US rate increases may be in store, with traders pricing in another quarter-point hike within the next two meetings.

©2023 Bloomberg L.P.

By Julia Fanzeres , Sri Taylor


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