UPDATE: US crude oil inventories have surged by 6.5 million barrels over the past week, according to the latest report from the American Petroleum Institute (API). This alarming increase adds pressure to an already volatile oil market, which is grappling with broader economic uncertainties and bearish trading conditions.
The rise in crude stocks was further compounded by a significant increase of 400,000 barrels in Cushing, Oklahoma, a key delivery hub for crude oil. As of now, oil prices are experiencing downward momentum, with ICE Brent settling 0.69% lower in yesterday’s trading session.
“While oil is under pressure, it performed better than other assets,” noted Ewa Manthey and Warren Patterson, commodity experts at ING.
Despite the bearish outlook on crude, there is some positive news for refined products. Gasoline and distillate stocks fell by 5.7 million barrels and 2.5 million barrels respectively, which could support refined product margins in the near term.
In an unexpected twist, reports have emerged that Ukraine has successfully targeted the Norsi refinery operated by Lukoil in Russia. This facility has a production capacity of approximately 340,000 barrels per day and its disruption is likely to bolster the middle distillates market. The ongoing conflict and drone attacks on Russian refinery infrastructures are intensifying market dynamics, pushing ICE gasoil crack prices around $30 per barrel.
With the oil market in a state of flux, analysts and investors are closely monitoring these developments. The implications of the increasing US inventories, combined with geopolitical tensions, suggest a turbulent road ahead for crude prices.
What’s next? Market participants will be watching closely for further inventory reports and geopolitical developments. The situation remains fluid, and any new data could significantly influence market sentiment and trading strategies.
Stay tuned for more updates as this story develops.
