Oil prices break range amid tightening market balance: ANZ Report

According to ANZ Bank's Friday note, Brent crude oil prices have broken out of their previously narrow range of US$81-84 per barrel, signaling a tightening market balance. As of early Friday, Brent crude was observed at US$84.93 per barrel, while West Texas Intermediate crude stood at US$80.83.

This shift follows the International Energy Agency's adjustment of its surplus estimate to a slight deficit, factoring in OPEC+'s extension of voluntary output cuts. The agency has also revised its 2024 demand projections upward to 1.3 million barrels per day from 1.2 million b/d, attributing the change to stronger-than-anticipated demand in the first quarter.

Additionally, ANZ Bank highlighted that the improving demand outlook is bolstering prices, with US oil refinery utilization expected to increase as facilities resume operations following disruptions caused by a winter freeze. Furthermore, European refinery margins are on the rise due to tighter availability of oil products.