West Texas Intermediate reached $74 while Brent oil traded above $79 per barrel. Both metrics increased to their greatest point in the past two weeks.
Supply concerns and resurgent demand from China as the country emerges from pandemic lockdowns are two variables that have supported oil prices. Despite this, the market remains uncertain as a result of a banking crisis that has affected organizations in both the US and Europe.
Oil prices are still being supported by supply concerns, according to Warren Patterson, the director of commodities strategy at ING Group NV in Singapore.
Following a disagreement involving Kurdish authorities that stopped about 400,000 barrels per day of shipments, tightening the market and contributing to an increase in prices, the US is encouraging Iraq and Turkey to restart exports from the port of Ceyhan.
As the dispute continues, Norway’s DNO ASA, one of the largest oil producers in Iraqi Kurdistan, has begun to reduce output.
According to individuals familiar with the data, the American Petroleum Institute reported on Tuesday that crude inventories decreased by 6.1 million barrels last week. If the government numbers released later Wednesday support that, it would be the biggest drop since November. According to the most recent estimate, US stockpiles are at their highest point since May 2021.
Despite this, both oil benchmarks are still expected to lose money each month due to worries about a possible US slowdown and strong Russian oil flows. Additionally, when the Joint Ministerial Monitoring Committee of the OPEC+ alliance meets the following week, there are no indications that production will be changed.
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