Oil Declines With US Stockpiles and OPEC+ Supply Policy In Focus

image is BloomburgMedia_S9IBJ1T0AFB400_28-02-2024_05-06-52_638446752000000000.jpg

Oil and fuel storage tanks at the Sinclair Casper Refining Co. oil refinery in Casper, Wyoming, U.S., on Thursday, Feb. 24. 2022. Oil extended its retreat from a seven-year high, slipping back below $100 a barrel in London, as Russia’s invasion of Ukraine forced traders to grapple with a fluid market environment.

Oil fell after a two-day gain as signs of higher US inventories vied with expectations that OPEC+ will extend supply cuts.

Global benchmark Brent crude dropped toward $83 a barrel after advancing by 2.5% over the week’s first two sessions amid strength in physical markets. West Texas Intermediate was below $79. The industry-funded American Petroleum Institute reported nationwide crude holdings rose more than 8 million barrels, including at the Cushing, Oklahoma, storage hub.

Official data on US inventories come later Wednesday. If these confirm an expansion, that would be a fifth week of gains in the largest oil consumer.


Crude is still pushing toward a second monthly gain, although prices remain within a relatively tight band. The advance has been supported by supply cuts from OPEC and its allies, and the group is widely expected to agree to prolong reductions into the second quarter to buttress the market. Prices have also been aided by tensions in the Middle East.

Widely tracked gauges point toward a tighter market. Near-term timespreads have been widening in a bullish, backwardated pattern — with prompt barrels more costly than longer-dated ones — and other physical metrics have also strengthened.

Crude markets are looking fairly stable, with prices around $80 a barrel, Vitol Group chief Russell Hardy said at International Energy Week in London. Oil markets are much less fragile than they were some years ago as sanctions regimes have been absorbed into the system, he said.

©2024 Bloomberg L.P.

By Yongchang Chin


Subscribe to our newsletter and get the best of Energy Connects directly to your inbox each week.

By subscribing, you agree to the processing of your personal data by dmg events as described in the Privacy Policy.

Back To Top