Oil prices nudged higher on March 31 with U.S. inflation data showing some signs of slowing price rises, but for the month, oil was on course for its weakest performance since November.
Brent futures, which have risen nearly 6% this week, were up 26 cents, or 0.3% at $79.53/bbl by 10:56 a.m. EDT (1456 GMT). West Texas Intermediate crude (WTI) rose 37 cents, or 0.5% to $74.74, having gained about 8% so far this week.
If those levels hold, oil prices will record their second straight week of gains, but Brent and WTI were also set for losses of about 5% and 3%, respectively.
The benchmarks hit their lowest since 2021 on March 20 in the wake of large bank failures, and while they have recouped some of the losses since then, they remain well below the levels they were trading at the start of March.
"The prolonged economic scarring of the last month will likely slow the economy, if not cause a recession, and lower interest rate expectations are not enough to support oil prices in the short term," said Craig Erlam, senior markets analyst at OANDA.
Providing support to prices on March 31, the U.S. Personal Consumption Expenditure (PCE) index, which is the Federal Reserve's preferred inflation gauge, rose 0.3% in February on a monthly basis, compared with a 0.6% rise in January and an expectation of a 0.4% rise in a Reuters poll.
Oil prices were also buoyed after producers shut in or reduced output at several oilfields in the semi-autonomous Kurdistan region of northern Iraq following a halt to the northern export pipeline.
With prices recovering from recent lows, the Organization of the Petroleum Exporting Countries and allies led by Russia are likely to stick to their existing output deal at a meeting on April 3, sources said.
OPEC pumped 28.90 million barrels per day (MMbbl/d) this month, a Reuters survey found, down 70,000 bbl/d from February. Output is down more than 700,000 bbl/d from September.
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