Oil trending upwards

Oil prices rose after the biggest weekly gain in a month as macroeconomic data from China beat expectations and Ukraine’s attacks on Russian refineries raised geopolitical risks. Global benchmark Brent rose 4% last week to $86 a barrel, while U.S. crude was above $81. Monday’s figures showed China’s factory output and investment rose more strongly than expected at the start of the year. The country is the world’s biggest oil importer. Meanwhile, drone attacks in Russia over the weekend hit several facilities, some deep inside the country’s territory. Diesel futures rose for a third session. The attacks came as Vladimir Putin clung to victory in the presidential election. Crude oil has broken out of the tight trading range that dominated the opening months of the year, and prices recently reached their highest level since November. The advance was supported by OPEC+’s production cuts and forecasts for the global budget deficit this year. Reflecting the shift in tone, banks including Morgan Stanley are upgrading their oil price forecasts. Attacks on Russian refineries added $2 to $3 a barrel risk premium to crude last week, continuing as more attacks start this week, said Vandana Hari, founder of Vanda Insights in Singapore. Still, with the U.S. monetary policy decision due this week, “economic sentiment could return to center stage for oil,” she said.