ISLAMABAD, (Ind:desk): Crude oil prices snapped a three-day losing streak and edged up on Thursday after falling to a seven-week low, driven by factors including surging crude inventories in the United States and prospects of a ceasefire agreement in the Middle East.
As of 1330 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $0.32 (0.38 percent) to reach $83.76 a barrel. Similarly, the West Texas Intermediate (WTI), the main oil benchmark for North America, went up by $0.19 (0.24 percent) to $79.19 a barrel.
On the other hand, the price of Arab Light decreased by $1.21 (-1.40 percent) to reach $85.44 a barrel. Similarly, the price of Russian Sokol decreased by $1.24 (-1.58 percent) to $77.23 a barrel. On the other hand, the price for Opec Basket remained unchanged at $88.72 a barrel.
Earlier, cruse prices fell more than 3 percent to a seven-week low on Wednesday after the US Federal Reserve kept interest rates steady and warned of stubborn inflation, which could curtail economic growth this year and limit oil demand increases. Oil prices rebounded after reaching their lowest since mid-March.
The major factor contributing to the decline in oil prices was the surge in the US crude oil inventories by 4.906 million barrels last week. Meanwhile, gasoline and distillate stockpiles saw a decline, according to figures from the American Petroleum Institute (API) on Tuesday. Gasoline inventories declined by 1.483 million barrels, while distillates declined by 2.187 million barrels.
Moreover, the EIA disclosed a substantial uptick in US crude supply, with production escalating to 13.15 million barrels per day in February from 12.58 million barrels per day in January. This surge, the largest monthly increase in approximately 3.5 years, hints at a growing capacity within the U.S. oil sector and its impact on global oil prices.
As hopes for a ceasefire agreement in the Middle East gained traction, oil prices faced further downward pressure as supply disruptions were set to ease.
Despite the downward trend, forecasts on the output by the Organization of the Petroleum Exporting Countries (OPEC) reveal a 100,000 barrels per day decline in April, bringing OPEC’s production to 26.49 million barrels per day. This decline reflects lower exports from Iran, Iraq, and Nigeria and underscores the ongoing efforts of some members to adhere to voluntary supply cuts agreed upon within the wider OPEC+ alliance.
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