Oil headed for a weekly gain on signs of tightening supplies before the release of U.S. inflation data that may give further clues on the path forward for monetary policy.

Brent rose slightly to top US$89 a barrel and is 2.3 per cent higher for the week. Figures earlier this week showed U.S. crude stockpiles falling, and key timespreads indicate tight supplies. A gauge of US markets known as the cash roll, which measures the demand for barrels for immediate delivery at a key storage hub in Oklahoma, is the strongest since 2022.

The U.S. Federal Reserve’s preferred inflation figure is due later Friday, coming on the heels of statistics showing weaker U.S. economic growth. Other gauges of price increases in the U.S. remained hotter-than-expected, suggesting the timing of rate cuts may be pushed back.

Crude has advanced this year on supply cuts implemented by OPEC+ and political risks in the Middle East, including heightened tensions between Israel and Iran that lifted Brent above $90 a barrel earlier this month.

Despite the nearby strength, there are concerns in other corners of the market. In Europe, diesel’s premium to crude is the smallest since June as that part of the barrel continues to exhibit softness.

“We’re going into the $90s for crude for a while,” said Aldo Spanjer, senior commodities strategist at BNP Paribas. “What people are struggling with is that a lot of the increase we have seen is actually the macro environment.”

Also in focus Friday will be earnings and market commentary from some of the world’s biggest oil majors, including Chevron Corp. and Exxon Mobil Corp.

Prices:

• Brent for June settlement rose 0.4 per cent to $89.34 a barrel at 10:52 a.m. in London.
• WTI for June delivery climbed 0.4 per cent to $83.94 a barrel.