Investing.com -- Oil prices rose Tuesday, gaining for the fourth consecutive session as forecasts of a drop in U.S. shale output added to concerns about tightening global supply for the rest of the year.
By 09:20 ET (13.20 GMT), the U.S. crude futures traded 0.9% higher at $91.38 a barrel, while the Brent contract climbed 0.6% to $95.00.
Prices have gained for three consecutive weeks, and both benchmarks are around 10-month highs.
U.S. shale output to continuing falling
U.S. oil production from top shale-producing regions is on track to fall for a third month in a row in October to the lowest level since May 2023, the U.S. Energy Information Administration said in its monthly drilling productivity report on Monday.
Output is expected to fall to 9.393 million barrels per day in October from 9.433 million barrels in September, EIA data showed, and the estimated decline of about 40,000 barrels per day would be the biggest monthly drop since December 2022.
This has added to worries of a substantial supply deficit this year stemming from extended production cuts by Saudi Arabia and Russia.
OECD lifts 2023 global growth forecast
Helping sentient Tuesday was the news that the Organisation for Economic Co-operation and Development had predicted more upbeat global growth this year, as a stronger than expected U.S. economy overshadowed a weakening Chinese economy.
The Paris-based body said it now expected global gross domestic product to grow 3.0% this year, an upgrade from 2.7% in its June outlook, before slowing to 2.7% in 2024, a drop from its estimate of 2.9% in June.
“Given the constructive fundamentals and more positive sentiment, we could see ICE (NYSE:ICE) Brent breaking above US$100/bbl in the not-too-distant future,” said analysts at ING, in a note.
“However, such a move would likely be unsustainable, leading to growing political pressure, whilst the Saudis and the broader OPEC group will probably not want to push the market too high, given the demand destruction risks this could create.”
Central bank meetings in focus
There are a series of policy-setting meetings scheduled for this week, from the central banks of the U.S., Britain, Japan, Sweden, Switzerland and Norway.
The U.S. Federal Reserve is widely expected to keep interest rates on hold, but is also likely to maintain its hawkish outlook, especially after a recent upswing in inflation.
The Bank of Japan is tipped to maintain its accommodative monetary stance, but Interest rate hikes are likely elsewhere, which could stymie economic growth in Europe, a region that is already struggling, potentially hitting the fuel demand.
Elsewhere, industry body American Petroleum Institute releases its forecast of U.S. oil stockpiles later in the session, as a precursor for Wednesday’s official report.
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