Investing.com-- Oil prices rose on Friday amid optimism over U.S. interest rate cuts and improved summer demand, although gains were limited by data showing Chinese crude imports shrank in June.
Speculation over an Israel-Hamas ceasefire also saw traders attach a lower risk premium to oil this week, although it appeared unlikely that an agreement was imminent.
Oil also logged some losses after Hurricane Beryl was seen causing limited disruptions in production along the Gulf of Mexico.
Brent oil futures expiring in September rose 0.3% to $85.65 a barrel, while West Texas Intermediate crude futures rose 0.2% to $81.57 a barrel by 01:58 ET (05:58 GMT).
Chinese oil imports shrink in June
Data on Friday showed that Chinese imports of crude oil sank 11% year-on-year in June to 46.45 million metric tons.
The soft reading offset otherwise strong trade data from the country, which showed China's trade balance grew more than expected, while exports also surged.
But weak imports brewed concerns over sluggish crude demand in the country, especially as it grapples with weak economic growth.
Still, analysts at ANZ said that imports would likely pick up in the coming months amid low inventory levels and increased refinery activity.
Dollar sinks as weak CPI data drives rate cut hopes
Crude prices benefited from a sharp drop in the dollar after softer-than-expected U.S. inflation data ramped up bets on a September rate cut. The greenback slid to a one-month low against a basket of currencies on Thursday.
Consumer price index data read a touch weaker than expected for June, driving up hopes that the Federal Reserve will have enough impetus to cut rates by 25 basis points in September. This also came as Fed officials offered some positive comments on disinflation and a cooling U.S. economy.
Oil set for mild weekly losses amid profit-taking, ceasefire speculation
Brent and WTI futures were trading down 1.4% and 0.8%, respectively, for the week.
Oil markets saw some profit-taking after a stellar run-up over the past four weeks, which had seen them briefly hit over four-month highs.
Prices had also declined earlier this week after reports highlighted some progress in a ceasefire between Israel and Hamas.
While continued aggression by Israel in the Gaza strip diminished the prospect of a ceasefire, U.S. President Joe Biden said on Thursday that the White House was working to broker an agreement between Israel and Hamas.