Oil Up 2.5% As No Immediate Saudi Output Boost Expected

• Oil was up 2.5% on Friday after a U.S. official told Reuters that an immediate Saudi oil output boost was not expected, and as investors question whether OPEC has the room to significantly ramp up crude production.
• The comment during U.S. President Joe Biden's Middle East visit comes at a time when spare capacity at members of the Organization of the Petroleum Exporting Countries (OPEC) is running low.
• Brent crude futures were up $2.40, or 2.4%, to $101.50 a barrel by 12:57 p.m. EDT, while West Texas Intermediate crude rose $2.41, or 2.5%, to $98.19.
• Both benchmarks are on track for their biggest weekly percentage drops in about a month, largely on fears earlier in the week that a nearing recession would chop away at demand. Brent moved towards its third weekly drop, while WTI headed for its second weekly decline.
• S. President Joe Biden will on (Friday) July 15, 2022, fly to Saudi Arabia, where he will attend a summit of Gulf allies and call for them to pump more oil. However, spare capacity at the Organization of the Petroleum Exporting Countries is running low, with most of the producers pumping at maximum capacity, and it is unclear how much extra Saudi Arabia can bring into the market quickly.

(Source: Reuters)