On Friday, oil prices saw a significant rebound, ending a four-week period of decline. This recovery follows a reduction in worries about a global economic downturn, which has lifted expectations for increased energy demand.

As of the latest figures, Brent crude oil futures have risen by 0.6%, reaching $79.66 per barrel, while West Texas Intermediate (WTI) futures increased by 0.9%, settling at $76.84 per barrel. This upward movement is attributed to reduced fears of a global economic downturn and renewed investor confidence in the energy sector.

In the U.S., the number of active oil rigs has grown by three to a total of 485, indicating a modest resurgence in drilling activity. This increase comes despite a downward revision in the domestic oil production forecast to 300,000 barrels per day for 2024. The uptick in rig count reflects a cautious optimism in the sector, signaling potential growth despite production challenges.

China's economic indicators present a mixed picture. In July, the Consumer Price Index (CPI) rose more than expected, signaling higher consumer prices, while the Producer Price Index (PPI) fell less than anticipated, reflecting weaker producer prices. Despite these mixed signals, China's economic growth has slowed, prompting the government to cut interest rates to stimulate the economy. However, deflationary pressures persist, complicating the economic outlook.

The recent rise in oil prices follows a prolonged period of decline, during which prices hit seven-month lows. This rebound has been supported by improved oil inventory data and strong summer demand. However, geopolitical tensions continue to cast a shadow over the market. Recent incidents, including attacks on Russian infrastructure and escalating tensions between Iran and Israel, have heightened uncertainty. The assassination of key figures in the Middle East has further contributed to concerns about potential disruptions in oil supplies.

Looking ahead, there are several factors that could influence the oil market. Despite the current positive momentum, there is a risk of oversupply if global demand does not increase as expected. Planned increases in oil production starting in October may exacerbate this issue if demand growth fails to keep pace. In such a scenario, the industry may face adjustments in production plans or accept lower prices to balance the market.

Additionally, the interplay between economic growth, geopolitical events, and oil production levels will be crucial in determining future price trends. Analysts are closely monitoring these factors to gauge how they might affect oil prices in the coming months.