NEW YORK: On Thursday, oil prices increased by over $1 per barrel following two sessions of declines due to supply concerns, as it is anticipated that the Opec+ producer alliance will maintain its existing output restrictions.
At 1:28 PM EDT (17:28 GMT), Brent crude futures for May were up $1.30, or 1.5 percent, at $87.39 per barrel. At 1:28 pm, the more actively traded June contract increased by $1.22, or 1.4 percent, to $86.43. On Thursday, the May contract expires.
At $82.78 per barrel, US West Texas Intermediate (WTI) oil futures for May delivery were up $1.43, or 1.8 percent.
For the third straight month, both benchmarks were expected to end higher, having increased by more than 2 percentage points over the week.
According to statistics from the Energy Information Administration, last week’s unexpected increase in US crude oil and gasoline inventories—caused by a spike in crude imports and weak gasoline demand—had put pressure on oil prices during the previous session.
Analysts observed that the increase in crude stocks was less than anticipated for the time of year, and it was less than the build that the American Petroleum Institute had predicted.
According to SEB analyst Bjarne Schieldrop, “We… expect US inventories to rise less than normal in reflection of a slight deficit in the global oil market.” “This is probably going to provide future support for the price of Brent crude oil.” Prices were also helped by a 0.9 percentage point increase in US refinery utilisation rates last week.
In contrast, the US economy expanded more quickly in the fourth quarter than was initially anticipated. The Bureau of Economic Analysis of the Commerce Department stated that the gross domestic product grew at an annualized rate of 3.4 percent, up from the previously reported pace of 3.2 percent.
According to Jim Ritterbusch of the energy consulting firm Ritterbusch & Associates, “the strength of the stock market suggests strong forward earnings that are, in turn, hinting at a surprisingly strong US economy conducive toward better than expected energy product demand.”
