FX: Oil prices are expected to record their best July performance in 20 years

Due to signs that the oil market is tightening,International crude oil prices are expected to record their largest monthly increase in more than a year in July.

FXTforeign exchange investmentIt is expected that when OPEC + cuts production,The demand for crude oil is growing at a record pace.And, according to analysts,Saudi Arabia is expected to extend its voluntary production cut 1 million barrels per day by another month until the end of September.

Oil prices are expected to record their best July performance in 20 years

Brent crude oilandWTI crude oilLast Friday closed at its highest level since April and has risen for the fifth consecutive week.

WTI prices rose to their highest level since April, having risen 14% this month as of last Friday.It is expected to record the largest increase since January 2022 and the best July performance in nearly two decades.On Monday, WTI hovered near a three-month high.

Oil prices have risen in a row, WTI crude oil futures have nearly wiped out their year-to-date losses, market sentiment has been boosted by expectations that the Federal Reserve is about to end its monetary tightening cycle, and the dollar has weakened. US jobs data released this week could signal a healthy demand outlook, while top importer China will continue to implement stimulus measures to boost the economy.

Oil prices are expected to record their best monthly performance since January 2022

Goldman Sachs continues to be optimistic about the outlook for oil prices

Goldman Sachs analysts said in a July 30 report that oil prices have risen 18 percent since mid-June, helped by record-high demand and a widening gap caused by Saudi supply cuts.And the market has given up its pessimism about economic growth.

"We still expect Saudi Arabia's plan to reduce production by an additional 1 million barrels per day to continue until the end of September and to halve from October."

The bank maintained its forecast for Brent crude at $86 a barrel in December and expects prices to rise to $93 a barrel in the second quarter of 2024.

Goldman Sachs expects global oil demand to rise to a record 102.80 million bpd in July and raises 2023 demand by about 550,000 bpd on expectations of strong economic growth in India and the United States. The report said:

"Stronger demand resulted in a slightly larger-than-expected shortfall in the second half of 2023, averaging 1.80 million bpd, and a shortfall of 600,000 bpd in 2024."

ExxonMobil CEO Darren Woods also said the company expects record oil demand this year and next, which could help push up energy prices in the second half of the year.

Speculators have also increased their bullish bets on the energy sector as crude oil prices have broken out of their near-term range.Net long positions in WTI and global benchmark Brent crude oil have increased to their highest level in three months