Oil gained for a second day above $48 a barrel as the dollar retreated, boosting the appeal of commodities priced in the U.S. currency.
Futures rose as much as 1.3 percent in New York after climbing 3.8 percent Friday. The Bloomberg Dollar Spot Index fell for a fourth day after closing at the lowest since June 9. Russian President Vladimir Putin is considering selling part of oil producer Rosneft OJSC to China and India as he struggles to meet spending commitments before a possible re-election bid in less than two years.
Crude has advanced more than 80 percent from the lowest level in 12 years as disruptions from Nigeria to Canada and falling output in the U.S. trim a global glut. The U.K. entered the final week of campaigning ahead of its referendum on European Union membership that is being watched by governments and investors around the world amid worries a so-called Brexit would spark a wave of turmoil across global markets.
“The biggest factor this week may well be currency, particularly given the uncertainty around the Brexit vote,” Michael McCarthy, a chief strategist at CMC Markets in Sydney, said by phone. “The widely shared view that the market will be balanced by the end of the year is keeping a bit of support in place. Oil above $50 will tempt the highly agile U.S. shale producers back into action, so that should keep a cap on prices.”
West Texas Intermediate for July delivery, which expires Tuesday, rose as much as 61 cents to $48.59 a barrel on the New York Mercantile Exchange and was at $48.51 at 12:37 p.m. Hong Kong time. Total volume traded was about 28 percent below the 100-day average. The more-active August contract gained as much as 63 cents to $49.19 a barrel.
Brent for August settlement climbed as much as 57 cents, or 1.2 percent, to $49.74 a barrel on the London-based ICE Futures Europe exchange. The contract advanced $1.98 to $49.17 on Friday. The global benchmark crude was at a premium of 54 cents to WTI for August.
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Russia is seeking buyers for 19.5 percent of Rosneft and would prefer a joint deal with the two nations leading the growth in global energy demand, two people familiar with the matter said. Officials in Moscow expect to raise at least 700 billion rubles ($11 billion) from the sale, which would set a privatization record for the country.
U.S. companies increased the rate of drilling for a third week, adding nine rigs to bolster the total number of machines to 337, according to data from Baker Hughes Inc. on Friday. BP Plc can keep spending at a reduced rate of about $17 billion for another three years without affecting growth, Chief Executive Officer Bob Dudley said in a Bloomberg television interview.