Oil Prices Reach New Highs Amid Supply Constraints and Demand Concerns
London – Oil prices have surged to new peaks, with Brent crude reaching its highest level since April. The tightening supply resulting from output cuts by Saudi Arabia and Russia has outweighed concerns over slow demand from China and rising US crude inventories.
Saudi Arabia’s cabinet has reaffirmed its support for precautionary measures by OPEC+ to stabilize the market. Brent crude has risen 0.7% to $86.81 and touched $86.94, its highest point in 7 months. US West Texas Intermediate (WTI) crude has also gained 0.9% to $83.70, reaching its highest level since November 2022.
These price increases follow six consecutive weeks of gains for crude oil. The reduction in OPEC+ supplies and hopes of stimulus measures boosting oil demand recovery in China have contributed to the upward trend.
Naeem Aslam, Chief Investment Officer at Avatrade, comments, “There is no doubt that there is plenty of momentum here. The clear trend seems to be skewed to the upside.”
However, the American Petroleum Institute (API) released figures showing a 4.1 million barrel increase in US crude stocks last week, which has exerted bearish pressure on prices. Gasoline and distillate inventories, on the other hand, have fallen.
“Prices remain stable this morning despite economic headwinds, helped by US product draws reported by the API, albeit crude inventories built more than expected,” says oil broker PVM.
Official US Energy Information Administration inventory figures are due to be released at 1430 GMT.
In addition to demand concerns from China, oil prices have received support from Saudi Arabia’s extension of its voluntary production cut of 1 million barrels per day until the end of September. Russia has also committed to reducing oil exports by 300,000 bpd in September.
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Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
Denial of responsibility! Samachar Central is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
