Oil Prices Surge to Four-Month High Amid Supply Concerns
Surprise Inventory Withdrawal Boosts Oil Prices
Oil prices climbed to a four-month high, driven by a surprising decline in inventories, a significant drop in U.S. gasoline stocks, and fears of potential supply disruptions following attacks on Russian refineries by Ukraine.
Impact of Inventory Data on Prices
Crude futures saw a 2.4% increase to $83.89 a barrel, while U.S. West Texas Intermediate (WTI) crude spiked by 2.7% to $79.63, marking Brent’s highest close since November 6.
Gasoline Prices Surge Amid Tightening Supply
Gasoline futures experienced a substantial price rise, hitting their highest levels since September 2023 after a massive 5.7 million barrel withdrawal from stockpiles last week, far exceeding analysts’ expectations.
Russian Refinery Attacks and Global Impact
Ukraine’s drone strikes on Russian refineries, including a significant fire at Rosneft’s largest facility, have raised concerns about disruptions in global oil supplies. The situation could lead Russia to import gasoline, affecting prices worldwide.
Geopolitical Tensions and Market Response
Russian President Vladimir Putin’s warnings of potential nuclear conflict and escalating tensions in Ukraine have added uncertainty to the oil market. However, the anticipation of interest rate cuts by mid-year has provided some support to oil prices.
Forecast and Expectations in the Oil Market
Organizations like OPEC maintain a positive outlook on oil demand growth, contrasting with other forecasts. The International Energy Agency’s upcoming updates on demand growth projections will shed more light on the future of the oil market.
