Oil prices climbed today on bets that OPEC+ will discuss output cuts at a meeting on September 5.
But fears of China's Covid-19 curbs and weak global growth continued to limit gains and a potential cap on the price of Russian exports loomed.
Brent crude futures rose $1.23, or 1.3%, to $93.59 a barrel this morning, while US West Texas Intermediate (WTI) crude futures advanced $1.25, or 1.4%, to $87.86 a barrel.
Both benchmark contracts slid 3% in the previous session to two-week lows. Brent was headed for a weekly drop of nearly 7%, and WTI was on track to fall about 5% for the week.
The Organization of the Petroleum Exporting Countries (OPEC and allies, together called OPEC+) are due to meet on September 5 against a backdrop of sliding prices and falling demand, even as top producer Saudi Arabia says supply remains tight.
"We expect the group to leave output targets unchanged. Their own numbers show a tighter-than-expected market and they would probably also want some more clarity on Iranian supply before making any big changes to output policy," said Warren Patterson, head of commodity research at ING.
OPEC+ this week slashed its demand outlook, now forecasting demand to lag supply by 400,000 barrels per day (bpd) in 2022, but it expects a market deficit of 300,000 bpd in its base case for 2023.
The market is also keeping a lookout for a potential price cap on Russian oil exports.
