© Reuters. FILE PHOTO: Miniatures of oil barrels and a rising stock graph are seen in this illustration taken January 15, 2024. REUTERS/Dado Ruvic/Illustration/File Photo

By Robert Harvey

LONDON (Reuters) -Oil prices rose on Friday and were set for weekly gains as markets awaited an OPEC+ decision on supply agreements for the second quarter while weighing fresh U.S., European and Chinese economic data.

futures for May were up 83 cents, or 1.01%, at $82.74 a barrel by 1050 GMT. The April Brent futures contract expired on Feb. 29 at $83.62 a barrel.

U.S. West Texas Intermediate (WTI) for April rose 81 cents, or 1.04%, to $79.07 a barrel.

Both contracts traded more than $1 a barrel higher at their intra-day peaks.

WTI is on track for a 3.4% increase this week, while following the switch in contract months Brent is around 1.4% higher than last week’s settlement price.

Increasing possibilities of Saudi-led OPEC+ continuing with its supply cuts beyond the first quarter, and potentially until the end of 2024, will likely keep oil prices above $80 a barrel, said DBS Bank energy sector team lead Suvro Sarkar.

A decision on extending OPEC+ cuts is expected in the first week of March, sources have said, with individual countries expected to announce their decisions.

A Reuters survey showed the Organization of the Petroleum Exporting Countries pumped 26.42 million barrels per day (bpd) in February, up 90,000 bpd from January.

Strong expectations of Saudi Arabia keeping term prices of crude it sells to Asian customers little changed in April from March levels also underpinned the market on Friday.

On the demand side, Chinese manufacturing activity shrank for the fifth straight month in February, an official survey showed.

Euro zone inflation fell in February according to Eurostat, but both the headline figure and core inflation, which strips out volatile food and fuel prices, just missed analysts’ expectations.

But supporting prices, U.S. personal consumption expenditures (PCE) index showed January inflation in line with economists’ expectations on Thursday, reinforcing market bets for a June interest rate cut.

“The process of disinflation is reassuringly under way, therefore smart money is currently on a June rate cut,” PVM analyst Tamas Varga said in a note on Friday.