Oil slips on U.S. stock build, trading in narrow range

Date:

- Advertisement -

Oil prices edged lower on Thursday after a large build in U.S. crude inventories but continued to trade in a narrow range as hopes for a Chinese demand recovery remained in focus.

Brent crude futures fell 36 cents, or 0.42%, to $85.02 a barrel by 1042 GMT. U.S. West Texas Intermediate (WTI) crude futures were down 29 cents, or 0.37%, at $78.30.

Prices were pressured by last week’s larger than expected build in U.S. crude oil stocks. Stocks rose to the highest level since June 2021, the Energy Information Administration (EIA) said on Wednesday.

The build was largely because of a data adjustment, which analysts said muted the impact on oil prices.

“Brent failed again to move above the 100-day moving average this week. Together with a large crude build in the U.S., prices remain under downward pressure,” said UBS analyst Giovanni Staunovo.

The Brent benchmark has been swinging within an $80-$90 a barrel range for the past six weeks while WTI has ranged between $72 and $83 since December.

“Oil prices are very choppy at the moment, with traders having a lot to take in,” OANDA analyst Craig Erlam said in a note, pointing to Russia’s 500,000 bpd cut to oil production in March, a strong Chinese economic recovery and an uncertain global economic outlook.

China will account for almost half of global oil demand growth this year after relaxing its COVID-19 curbs, the International Energy Agency (IEA) said on Wednesday.

On the supply side, the market is keeping a close eye on Russian oil production.

“It is open for interpretation how the country’s oil production will be affected by international sanctions or to what extent the invader would go to use oil as leverage,” said Tamas Varga of oil broker PVM.

Russian oil exports were down in January by only 160,000 bpd from levels before the war in Ukraine, but about 1 million bpd of production will be shut in by the end of the first quarter, the IEA said.

The market will look for economic clues from a host of Fed and ECB officials due to speak on Thursday.

- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Share post:

Subscribe

ADVERTISEMENT

Popular

More like this
Related

Ghana, creditor panel agree on debt restructuring, paving way for IMF cash

Ghana has finalised a pact with its official creditor...

Nigeria strikes deal with Shell to supply $3.8 billion methanol project

Nigeria has struck a deal for Shell (SHEL.L), opens new...

Africa’s $824 billion debt burden and opaque resource-backed loans hinder its potential, AfDB president warns

Africa's immense economic potential is being undermined by non-transparent...

IMF: South Africa needs decisive efforts to cut spending

South Africa needs more decisive efforts to cut spending...