Oil's Winning Streak Continues On Germany's Strong Economic Recovery

But India says high oil prices are merely a threat to its fragile economy: File Image/Pixabay

Germany on Thursday became the latest country to report strong economic growth in the wake of the pandemic lockdowns, and this in turn contributed to oil prices holding close to the highest level in nearly three years.

Germany  showed the largest upward climb in retail conditions since its East and West  reunification over 30 years ago, and with the expectation that this would lead to further recovery across Europe, Brent on Thursday settled up 37 cents to $75.56 per barrel by 1628 GMT.

West Texas Intermediate settled up settled up 22 cent to $73.30 per barrel, mainly due to U.S.  inventories dropping to their lowest since March 2020 and gasoline stocks posting a surprise draw.

But some effects of the global demand recovery continued to worry India, and on Thursday its oil minister, Dharmendra Pradhan, told the Organization of the Petroleum Exporting Countries during a video-conference that "High crude prices are adding significant inflationary pressure on India," and that the cartel should agree to boost output when it convenes to discuss the matter next week.

The cost of oil in India is fast approaching 5,550 rupees per barrel, just 10 percent less than during the market frenzy of 2007-08.

It's anyone's guess what OPEC will decide, given that its de facto leader, Saudi Arabia, has suggested it that will only cautiously restore shuttered output; Stewart Glickman, energy equity analyst at CFRA Research, said, "Given how disciplined they've been so far, I don't think it's going to be a free-for-all at this point."

Meanwhile, Iran once again tried to sound a note of optimism regarding its nuclear talks with the U.S., this time announcing that Washington had agreed to remove all sanctions on its oil and shipping.

However, Washington stressed that "nothing is agreed until everything is agreed," and Jim Ritterbusch, president of Ritterbusch and Associates, echoed the sentiment of the analytical community by stating, that the return of Iran to the global oil market "could still be months and not weeks away."