Oil continues to rise in price weakly on Thursday, after it rose in previous trading on fuel inventories data in the U.S.
The market is also supported by Russia’s plans to reduce oil production and exports, according to Trading Economics.
Brent crude futures on London’s ICE Futures Exchange rose $0.1 (0.12%) to $84.41 a barrel by 7:01 a.m. on May. On Wednesday those contracts grew by $0.86 (1%) to $84.31 per barrel.
WTI April futures price grew by $0.08 (0.10%) to $77.77 per barrel at electronic auctions of New York Mercantile Exchange (NYMEX) in the morning. According to results of previous trades the cost of contracts grew by $0.64 (0.8%) to $77.69.
Commercial oil inventories in the U.S. rose 1.17 million barrels last week to 480.21 million barrels, the Energy Department said Wednesday. Experts on average had expected an increase of 1.9 million barrels.
Stocks at the terminal in Cushing, which stores oil traded on the NYMEX, increased last week by 300,000 barrels.
Gasoline stocks declined by 874,000 barrels and distillates stocks increased by 179,000 barrels. Analysts forecasted a decrease in gasoline reserves by 1 million barrels and distillates by 500 thousand barrels.
Oil is getting cheaper on Monday after a strong growth in previous trading.
Data published in the U.S. on Friday pointed to the continuing high level of inflation in the country. This could prompt the Federal Reserve to raise interest rates to a greater extent, which will have a negative impact on the U.S. economy. A recession, in turn, would reduce demand for fuel, analysts said.
The quotations of April futures for Brent crude oil at London’s ICE Futures exchange fell by $0.29 (0.35%) to $82.87 per barrel by 6:59 a.m. on Tuesday. On Friday those contracts rose by $0.95 (1.2%) to $83.16 per barrel.
The price of WTI April futures on NYMEX fell by $0.2 per barrel to $76.12 in the morning. According to results of previous trades the cost of contracts grew by $0.93 (1.2%) to $76.32.
Brent added 0.2% and WTI 0.3% over the week.
The U.S. consumer price index (PCE) rose 0.6% in January from the previous month, the highest gain in six months, and rose 5.4% year over year, the Commerce Department said Friday. It was up 0.2% and 5.3% in December, respectively.
The PCE Core index, which excludes food and energy costs, rose 0.6% for the month (up 0.4% in December). In annual terms, the indicator, which the Federal Reserve closely monitors when assessing inflation risks, accelerated to 4.7% from 4.6% in December. At the same time analysts expected a less significant rise – by 0.4% and 4.3%, respectively.
Oil continues to fall on Wednesday after a decline in previous trading.
Investors are evaluating the forecasts of global demand for fuel amid uncertainty about the global economy, writes MarketWatch.
At 8:05 Moscow time, quotations of April futures for Brent oil fell by $0.27 (0.33%) and totaled $82.78 per barrel at ICE Futures Exchange in London. Those contracts fell by $1.02 (1.2%) to $83.05 per barrel on Tuesday.
The price of WTI April futures on NYMEX fell by $0.27 (0.35%) to $76.09 per barrel. At the end of previous trading the value of contracts went down by $0.19 (0.3%) to $76.36.
The market’s attention is focused on the publication of the Federal Reserve’s meeting minutes on Wednesday, Bloomberg notes.
“Expectations of a more hawkish position by the Fed continue to grow, which puts strong pressure on the oil market,” Warren Patterson, head of commodity markets strategy at ING Groep NV in Singapore, believes.
Oil prices are down on Monday after rising more than 2% on Friday on information about Russia’s intention to reduce production.
April Brent crude futures on London’s ICE Futures exchange stood at $85.58 a barrel by 7:10 a.m. Monday, down $0.81 (0.94%) from the previous session’s closing price. Those contracts rose $1.89 (2.2%) to $86.39 a barrel on Friday.
The price of WTI futures for March crude oil fell by $0.92 (1.15%) to $78.8 per barrel at electronic auctions of New York Mercantile Exchange (NYMEX) by that time. The contract value grew by $1.66 (2.1%) to $79.72 per barrel at the end of previous session.
Over the previous week Brent gained 8.1% and WTI gained 8.6%.
Russian Deputy Prime Minister Alexander Novak told reporters on Friday that the country intended to cut oil production by 500,000 bpd in March.
Most analysts have already put the likelihood of Russia cutting oil production by 700,000 to 900,000 barrels in 2023 on prices, said CIBC Private Wealth US senior trader Rebecca Babin.
“The key factor that could lead to prices moving out of the current range is the dynamics of Chinese demand,” she says.
Oil goes up in price on Tuesday after Saudi Arabia raised prices for most grades of this energy carrier for Asian buyers.
On the eve of the state company Saudi Aramco said that the cost of the main variety of Arab Light delivered to Asia in March will increase by $0.2 per barrel. As a result it will be $2 a barrel more expensive than the oil basket of Oman and Dubai.
The price of this grade has risen for the first time since September.
The price increase for Asia is a signal of higher-than-expected demand for oil in China, said Phil Flynn, chief analyst at The Price Futures Group. “This should provide significant support for the oil market, given increasing investor fears about the amount of spare production capacity in the world,” Bloomberg quotes the expert.
The cost of April futures for Brent crude oil on London’s ICE Futures exchange is $81.74 a barrel by 7:15 a.m. Tuesday, up $0.75 (0.93%) from the previous session’s closing price. Those contracts rose $1.05 (1.3%) to $80.99 a barrel at the close of trading on Monday.
The price of WTI futures for March crude oil grew by $0.74 (1%) to $74.85 per barrel at electronic trades of New York Mercantile Exchange (NYMEX) by that time. By the close of previous trading the cost of those contracts grew by $0.72 (1%) to $74.11 a barrel.
Earlier, Goldman Sachs Group Inc. chief commodity markets analyst. Jeffrey Curry said that reserve production capacity in the oil sector, according to his estimates, is running out and this may become a serious problem for the market in 2024.
Oil prices are also boosted by fears of supply cuts from the Middle East following the earthquake in Turkey. In particular, operations at Turkey’s Ceyhan oil terminal were suspended, Bloomberg notes.
Oil prices stabilized on Monday after a sharp drop last week.
The value of April futures for Brent on London’s ICE Futures Exchange stood at $80.14 a barrel by 7:15 a.m. Monday, $0.2 (0.25%) above the previous session’s closing price. Those contracts fell $2.23 (2.7%) to $79.94 a barrel at the close of trading on Friday.
The price of WTI futures for March increased by $0.09 (0.12%) to $73.48 per barrel at electronic auctions of New York Mercantile Exchange (NYMEX). By closing of previous trades the cost of these contracts went down by $2.49 (3.3%) to $73.39 per barrel.
Brent has fallen by 7.5% and WTI by 7.9%.
The market decline was helped by the weakening optimism of traders regarding the demand growth in China after the lifting of the anti-crisis restrictions, as well as strong data on the US labor market, which showed that the Federal Reserve (Fed) still has some room for maneuver in terms of tightening its monetary policy.
Over the weekend, however, Fatih Birol, head of the International Energy Agency, told Bloomberg that China’s economic rebound after the rejection of harsh quarantine measures may be more powerful than expected.
According to Birol’s forecast, the Chinese economy will account for about half of the growth in oil demand this year.
Another factor the market is closely watching is the EU and G7 decision to impose an embargo on oil product imports from Russia, which came into force on February 5.
