Oil rose, aided by signs of a tightening market and as a selloff in global stock markets paused.
(Bloomberg) — Oil rose, aided by signs of a tightening market and as a selloff in global stock markets paused.
Brent futures, the global benchmark, climbed above $95 a barrel. The premium for near-term barrels of US benchmark West Texas Intermediate is at the highest level in more than a year, indicating a deficit. Official data due later Wednesday may confirm another draw in crude inventories at an important US storage site.
While oil’s rally has rekindled talk of $100-crude, the gains had stalled over the past week. Key consumer India has noted the negative effects of higher prices on its economy, which raises some questions about the demand outlook into next year. Inventories have been falling in most regions though, most notably at the US futures delivery point of Cushing, Oklahoma.
“My fear in this market is we have de-stocked so much inventory,” Amrita Sen, co-founder and head of research at consultant Energy Aspects, told Bloomberg TV. “Right now, what’s going on in the US — Cushing is dry.”
On Tuesday, the industry-funded American Petroleum Institute reported that inventories at the Cushing storage hub declined again last week, though nationwide stockpiles rose, according to a person familiar with the data. A separate estimate from AlphaBBL Corp. also pointed to a drop at Cushing, where holdings have already sunk to the lowest since mid-2022.
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–With assistance from Tom Keene, Jonathan Ferro and Lisa Abramowicz.
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