Oil Slides as U.S Inventories Rise Against Expectations
Crude oil price bump after U.S inventories unexpectedly rose as well as signs of weaker demand, Australia’s ANZ Bank said in a Thursday note ahead of the Organisation of the Petroleum Exporting countries oil market report.
International benchmark Brent crude was trading at $82.94 per barrel while the American benchmark West Texas Intermediate (WTI) was at $81.64 per. On Wednesday, Brent crude has reached as high as $85.50 per barrel while WTI hit $84.97.
However, both benchmarks dropped by more than 3% after reports that U.S inflation hit the highest level in 31 years high.
U.S crude oil stocks rose to 435.1 million barrels in the week of Nov. 5, from 434.1 million barrels a week ago, the US Energy Information Administration reported in its this Week in Petroleum report on Wednesday.
The States natural gas stocks increased 7 Bcf to 3,618 Bcf in the week of Nov. 5, the EIA reported in its Weekly Natural Gas Storage report on Wednesday.
Working gas in storage in the report week was 308 Bcf lower than levels in the same week a year ago and 119 Bcf below the five-year average, the EIA said.
The Organization of the Petroleum Exporting Countries (OPEC) will release its November monthly oil market report on Thursday, the group said in an email.
US President Joe Biden also asked his economic advisors to explore ways to lower energy prices, ANZ Bank said. The U.S may also coordinate releases of inventory with other nations like Japan, according to speculations.
However, European gas extended losses as Russian supplies improved, with gas flows into Europe from Poland and Ukraine picking up on Wednesday, according to ANZ Bank.
Gazprom’s booked capacity only brings supply to levels agreed under an existing long-term transit agreement, the bank said.
Below-average temperatures forecast for the coming week have raised concerns over securing additional gas to keep the market sufficiently supplied, ANZ Bank said.
North Asian LNG markets echoed weakness in Europe, with the JKM futures down nearly 2%. Concerns over supply shortages eased after data showed US LNG exports rising 8% year over year in November, according to ANZ Bank.
Crude stockpiles were lower this week compared with levels a year ago at 488.7 million barrels, the EIA reported.
Meanwhile, Crude oil futures averaged $79.57 per barrel in the report week, down from $80.95 per barrel a week ago against an average of $37.72 a barrel in the same period a year ago.
Also, gasoline prices continue on an upward trajectory at $3.41 per gallon, compared with $3.39/gal a week ago. A year ago, gasoline prices were at $2.10/gal. #Oil Bumps as U.S Inventories Rise Against Expectations
