As indications of reduced US supply helped ease concerns about the global oil market’s deteriorating demand, oil prices steadied throughout Wednesday’s Asian trading session. After dismal economic statistics from China, the world’s largest oil importer, increased worries about slowing demand, crude markets were nursing a steep fall over the previous week.
October contract prices for Brent and West Texas Intermediate oil increased by 0.1% and 0.1%, respectively, to $83.80 and $79.80 per barrel. The American Petroleum Institute released statistics on Tuesday that showed a larger-than-anticipated decline in U.S. oil stockpiles in the week leading up to July 12. In contrast to projections of a 33,000-barrel draw, inventories decreased by 4.4 million barrels.
Israel kept up its strikes on Gaza, maintaining a high level of tension with Hezbollah and Hamas. Additionally, Yemeni militias were observed repeatedly attacking ships in the Red Sea, which might impede the flow of crude oil. Traders began to attach a risk premium to oil prices, while it was still unclear how much the Middle East’s unrest impacted the price of petroleum.
This week’s media reports revealed that the Organisation of Petroleum Exporting Countries, including Russia, reaffirmed their plans to restrict output and tighten the world’s oil markets. Nonetheless, worries about declining Chinese demand in the wake of several dismal economic data points from the nation sustained pressure on oil prices. The data released last week also revealed a dramatic decline in China’s imports of petroleum in June.
