- WTI price depreciates as OPEC+ could extend voluntary oil output cuts into Q2.
- Geopolitical supply risks in the Middle East help to offset the concerns about global oil demand.
- API Weekly Crude Oil Stock increased to 8.428 million barrels from the previous 7.168 million barrels.
West Texas Intermediate (WTI) oil prices decline after two consecutive days of gains, with trading around $78.30 per barrel during the Asian session on Wednesday. The oil market is facing challenges due to higher borrowing costs, which are dampening global economic growth and subsequently reducing oil demand. Additionally, uncertainty persists regarding the outcome of ceasefire talks between Israel and Hamas, while Iran-backed Houthis continue to target civilian shipping vessels in the Red Sea.
Crude benchmarks received upward support following a Reuters report stating that the Organization of the Petroleum Exporting Countries and allies (OPEC+) are contemplating extending voluntary oil output cuts into the second quarter. In November, OPEC+ had agreed to voluntary cuts amounting to around 2.2 million barrels per day (bpd) for the first quarter of this year. Additionally, Russia has announced a six-month ban on gasoline exports starting from March 1. This decision, as reported by Russia’s RBC, is aimed at stabilizing oil prices.
However, persistent geopolitical supply risks in the Middle East, coupled with indications of a stronger US physical market, are helping to mitigate the effect of the concerns about global oil demand. As a result, the decline in Crude oil prices is being limited. Recent data reveals an increase in demand for US crude exports, while Chinese buyers are actively participating in the spot market following the Chinese Lunar New Year, boosting Crude oil consumption.
American Petroleum Institute (API) revealed that Weekly Crude Oil Stock increased to 8.428 million barrels for the week ending on February 23, from the previous 7.168 million barrels. Furthermore, the US Energy Information Administration (EIA) is expected to report a decline in the Crude Oil Stocks Change on Wednesday.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.