NEW YORK (AP) – Oil prices spiked on Wednesday as the European Union (EU) announced…
Oil prices fluctuate as US inventories rise and the dollar weakens.
On Friday, oil prices ended with a mixed result due to a declining dollar and a larger-than-expected increase in US stocks, suggesting a demand decline.
At 9:21 a.m. local time (06:21 GMT), the price of international benchmark Brent crude was $94.79 per barrel, up 0.2 percent from the previous trading session’s closing price of $94.57 per barrel.
The price of American benchmark West Texas Intermediate (WTI), which is currently trading at $89.48 per barrel, gained by 0.4 percent from the previous session’s closing price of $89.11 per barrel.
The decreasing dollar, which has made oil cheaper for customers using foreign currencies, is one of the main causes of price swings. This has supported prices.
Prices are also being supported by OPEC+’s decision to reduce output by 2 million barrels per day beginning in November, which was made on October 5. OPEC+ is commonly known as OPEC.
According to information made public by the Energy Information Administration (EIA) on Wednesday, US commercial crude oil stocks rose by 2.3 percent on October 7, which restrained the price increase.
The market had anticipated an increase of about 7.05 million barrels, but inventories increased by over 9.9 million barrels to 439.1 million barrels, raising concerns about demand in the nation.
The report showed that strategic petroleum reserves—which are not included in commercial oil stocks—fell from 7.7 million barrels to 408.7 million barrels last week.
Over the same period, gasoline inventories rose by 2 million barrels to 209.5 million.
Reduced forecasts for the global demand increase in 2022 and 2023
In the meantime, the IEA warned against “the persistent deterioration of the economy,” and higher prices brought on by the OPEC+ supply-cutting strategy, which is also lowering global oil consumption, in its monthly report on Wednesday.
The organization decreased its predictions for worldwide demand between 2022 and 2023.
“In comparison to last month’s report, demand growth decreased to 1.9 million BPD in 2022 and to 1.7 million BPD the following year. In 2023, the global oil demand is anticipated to be 101.3 million BPD on average, “It read.
While everything is going on, US President Joe Biden and his top officials have been publicly arguing with Saudi Arabia over limits to the world’s oil supply for more than a week.
While Secretary of State Antony Blinken said the US is “reviewing” consequences for Saudi Arabia after the decision, the White House said Thursday that the decision by Saudi-chaired OPEC+ to cut global oil production dramatically amounts to “moral and military support” for Russia’s ongoing war against Ukraine.
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