Oil prices increased by more than $1 on August 17, climbing from six-month lows reached the day before, as traders were alerted by an unanticipated massive fall in US oil and gasoline supplies that demand is still strong, despite being obscured by the possibility of a worldwide downturn.
The price of Brent crude futures had increased to $93.16 bbl. The price of a barrel of West Texas Intermediate (WTI) oil futures increased to $87.38.
The contracts fell by roughly 3% yesterday as worries about a future worldwide recession grew in response to disappointing US housing starts statistics. With stocks of US gasoline declining for a second week in a row, investors are more confident that demand will remain strong, which has led to purchases. However, in response to fears about a probable global recession, the oil market is anticipated to remain under pressure with a significant amount of volatility.
American Petroleum Institute numbers from yesterday were cited by market sources as evidence that US oil and fuel stockpiles decreased in the most recent week.
For the week ending August 12, crude stockpiles fell by roughly 448,000 barrels. Per the sources, distillate stocks decreased by roughly 759,000 barrels, and gasoline stockpiles decreased by around 4.5 million barrels.
Oil is currently susceptible to a set of bearish influences and potential losses, including the chance of a recession, China’s weak economic data, and the prospect of an Iranian nuclear agreement.
However, crude has retreated somewhat, and investors must not lose sight of the fact that the market is still extremely tight at the time being.
If talks to reinstate the 2015 nuclear agreement between Iran and the international community are productive, restrictions on Iranian oil exports would be lifted, analysts said, which may increase the availability of oil.
When Tehran urged Washington to be flexible, the EU and the US announced on August 16 that they were examining Iran’s reply to the so-called final offer to preserve the agreement.
