WTI struggles for a firm intraday direction, consolidates in a range around mid-$82.00s

West Texas Intermediary (WTI) Crude Oil prices struggle to gain any meaningful traction on Friday and oscillate in a narrow band, around mid-$82.00s through the Asian session. The commodity, meanwhile, manages to hold above the weekly low touched on Thursday and draw support from supply concerns in an already tight market.

The US toughened its stance against Russia and imposed sanctions on two shipping companies for carrying Russian Oil bought at a price greater than the $60/barrel price cap imposed by G7 countries last year. The tighter US scrutiny of exports from Russia –  the world's second-largest oil producer – could curtail supply. This, along with a forecast that global inventories will decline through the fourth quarter, continues to lend some support to Crude Oil prices.

Furthermore, OPEC kept its forecast for growth in global oil demand, citing signs of a resilient world economy so far this year, and expected further demand recovery in China – the world's biggest Ol importer. Adding to this, the International Energy Agency (IEA), in its monthly oil market report, raised the global Oil demand growth forecast for 2023 to 2.3 million bpd from 2.2 million bpd previous, though downgraded it for the next year to 880K bpd from 1 million bpd.

The US CPI report released on Thursday, meanwhile, revived bets for at least one more rate hike by the Federal Reserve (Fed) in 2023 and triggered a sharp rise in the US Treasury bond yields. This raises concerns about economic headwind stemming from rapidly rising borrowing costs, which is expected to dent fuel demand. Apart from this, receding fears about potential supply disruptions due to the Israel-Palestinian conflict should cap the upside for Crude Oil prices.

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