UPDATE 7-Oil notches second weekly gain despite India virus surge

Reuters

Warning: This material has been prepared by a third party company, Reuters, which is independent of Davy. Davy has not reviewed the material and accepts no responsibility for errors or omissions, or for the information or opinions contained therein. It does not constitute investment advice.

    * China's exports and services sector expand in April
    * April crude imports down 0.2% year on year in China
    * U.S. drillers add oil and gas rigs for 2nd week -Baker
Hughes

 (Updates to settlement)
    By Devika Krishna Kumar
    NEW YORK, May 7 (Reuters) - Oil edged up slightly on Friday
even as the COVID-19 crisis in India worsened, and prices
notched a second weekly gain against the backdrop of optimism
over a global economic recovery.
    Brent crude futures  LCOc1  ended the session at $68.28 a
barrel while U.S. West Texas Intermediate (WTI) crude  CLc1 
settled at $64.90 a barrel, both up 19 cents, or 0.3%.
    The two benchmarks rose by more than 1% on the week, their
second consecutive weekly gain, as easing COVID-19 restrictions
on movement in the United States and Europe, recovering factory
operations and coronavirus vaccinations pave the way for a
revival in fuel demand.
    "Oil prices might still have a positive second consecutive
week, but it is nothing to get energy traders excited that oil
will break away from its tightening trading range. Oil's
short-term outlook remains very mixed," Edward Moya, senior
market analyst at OANDA said. 
    In China, data showed export growth accelerated unexpectedly
in April while a private survey pointed to strong expansion in
service sector activity.  urn:newsml:reuters.com:*:nL1N2MU04N  urn:newsml:reuters.com:*:nZRN001XGL
    However, crude imports by the world's biggest buyer fell
0.2% in April from a year earlier to 40.36 million tonnes, or
9.82 million barrels per day (bpd), the lowest since December.
 urn:newsml:reuters.com:*:nL1N2MU053
    The recovery in oil demand, however, has been uneven as
surging COVID-19 cases in India reduce fuel consumption in the
world's third-largest oil importer and consumer.
 urn:newsml:reuters.com:*:nL1N2MO08Y urn:newsml:reuters.com:*:nL1N2MN034
    India on Friday reported a record daily rise in coronavirus
cases of 414,188, while deaths from COVID-19 swelled by 3,915,
according to health ministry data.  urn:newsml:reuters.com:*:nFWN2MT1U3
    "Brent came within a whisker of breaking past $70 a barrel
this week but failed at the final hurdle as demand uncertainty
dragged on prices," said Stephen Brennock at oil brokerage PVM. 
 
    The resurgence of COVID-19 in countries such as India, Japan
and Thailand is hindering gasoline demand recovery, energy
consultancy FGE said in a client note, though some of the lost
demand has been offset by countries such as China, where recent
Labour Day holiday travel surpassed 2019 levels.
    "Gasoline demand in the U.S. and parts of Europe is faring
relatively well," FGE said.
    "Further out, we could see demand pick up as lockdowns are
eased and pent-up demand is released during the summer driving
season."
    In the United States, job growth unexpectedly slowed in
April, likely restrained by worker shortages that have left
businesses scrambling to meet booming demand as the economy
reopens.  urn:newsml:reuters.com:*:nL1N2MT2XD 
    The U.S. oil and gas rig count, an early indicator of future
output, rose eight to 448 this week, its highest since April
2020, energy services firm Baker Hughes Co said. Since hitting a
record low in August, the number of drilling rigs have been
growing modestly along with the recovery in oil prices.  RIG/U 

 (Additional reporting by Ahmad Ghaddar in London, Florence Tan
in Singaore
Editing by Marguerita Choy and Louise Heavens)
 ((devika.kumar@thomsonreuters.com; +1 646 223 6059; Reuters
Messaging: devika.kumar.thomsonreuters.com@reuters.net))

Warning: This content may be provided by regulated and unregulated entities and is not created, reviewed or endorsed by Davy. It is provided for general information purposes only and does not constitute a recommendation or solicitation to purchase or sell any security or make any other type of investment or investment decision. Importantly, it does not constitute investment advice, as it does not contemplate the personal circumstances of any particular person or group of persons. Neither Davy nor the providers of the Third Party Content will be liable for any investment decision made based on the reliance on or use of such data, or any liability that may arise due to delays or interruptions in the delivery of the Third Party Content for any reason.