(Bloomberg) — Oil prices rose but remained in a narrow range as bullish momentum across the market offset weak near-term fundamentals for crude and prompted traders to shift focus to next year’s contract.
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West Texas Intermediate (WTI) rose about 1% to approach $82 a barrel, but remains within the sub-$2 range it has been trading at this week, the tightest weekly range for WTI since January 2021. An unexpectedly large buildup in U.S. crude oil inventories on Wednesday did not drive prices lower as strong stock prices spurred investor appetite for riskier assets.
The stalemate in the oil market has investors looking for further avenues to make profits, sparking active trading in the 2025 contract. Prices for June and December 2025 West Texas Intermediate (WTI) crude oil contracts rose to two-month highs on Thursday.
The latest government reports have given the bears plenty to go around. U.S. Gulf Coast crude oil inventories rose by 2.05 million barrels last week, bringing total inventories to the highest since April. There are also signs that fuel consumption is slowing, with weak demand indicators for gasoline and jet fuel.
Still, oil prices have been trending higher for the month on expectations of increased consumption during the U.S. summer driving season.
“The physical market isn’t that strong right now,” said Alex Hodes, an energy analyst at StoneX. “This gives us further evidence that these rallies are based on demand expectations rather than what we’re seeing on the ground.”
Traders are also keeping a close eye on a variety of U.S. economic data over the next two days, including consumer spending and employment reports.
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