Oil prices traded lower after the Energy Information Administration (EIA) reported a higher than expected buildup of US crude inventories. Stock rose by 7 million, but the report was mixed as gasoline inventories fell by 7.7 million barrels. West Texas Intermediate fell after the report was released, but Brent continues to gain as OPEC cuts are forging ahead with an additional 534,000 daily barrel cut in March.
Supply disruptions have added to the OPEC+ pressure leading oil prices higher. US sanctions against Venezuela and Iran are combining with the military situation in Libya. US production has risen but for now the supply side is making a stronger push towards rebalancing of the market.
Russian comments this week on taking a more cautious approach to committing to an extension of the production cut agreement could tip the scale.
Energy prices will remain sensitive to demand fundamentals with an eye on how trade negotiations evolve. With the US-China deal closing in on an agreement, the US is now amping up disputes with Mexico and the European Union. The global growth downgrade this week by the IMF is another warning of the impact a trade war could have on the world’s demand for energy.
Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.
Alfonso Esparza
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Latest posts by Alfonso Esparza (see all)
- Market Rally Still Going Low Holiday Volumes Awaiting Start of 2020 - 27 December 2019
- Market Awaits China Retaliation on Trade - 29 November 2019
- Alibaba to Close Order Book Ahead of Huge IPO - 18 November 2019