Showing posts from November 7, 2021

Oil price continues to rise between two contradictory US inventory reports

  The inexplicable fluctuation of crude oil continued on Thursday, perhaps fuelled by the anticipation of a potential move by the US to calm the crude oil markets. As of 14:45 on Thursday, the price of WTI and Brent were at $81.83 and $83.19 respectively. The US crude oil inventories, according to the industry-funded API, American Petroleum Institute, fell down by 2.485 million barrels for the week ending November, 5; it was significant on Tuesday for the crude oil market watchers, as the good news came after six weeks of inventory builds. On Wednesday, however, the EIA, the US Energy Information Administration, contradicted the short-lived positive perception with its own data; the crude build, according to the EIA, continued for the seventh successive week,   for the week ending November, 5, with over 1 million barrels. In response, the oil price fell during the early hours of trading on Thursday, although prices recovered later on the day. At present, there is a palpable a

Crude oil price went up due to fallen US crude inventories

  The US crude oil inventories dropped during the last week, having been on the rise for six successive weeks, while defying the logic of analysts. The API, American Petroleum Institute, reported on Tuesday that the US crude inventories fell by 4.585 million barrels, exceeding the expectations; the forecast was a build of 1.9 million barrels. In response to the surprising news, the price of crude oil went up on Tuesday, only to fall slightly as the day wore on. Crude oil markets are still edgy as the response of the Biden administration to the rising oil prices is anybody’s guess at the moment. When the OPEC+ refused to toe the line of the major consumers, President Biden vowed to resort to ‘other measures’, without specifying what they could be. As the COP26 conference is coming to a close, the Western leaders finally will be able to react to what is happening on the ground due to fossil fuels shortages, with the luxury of being free from the shackles of various pressure gro

Plummeting temeratures in China adds more pressure on energy markets

  The price of oil and other commodities is one of the hot topics in the corridors of power in the world, regardless of the economic status of the country in question, because the rising price of oil, gas and coal have already taken its toll on the recovery of the global economy as a whole, despite the soothing soundbites to the contrary. It’s an undeniable fact that there are supply chain issues in all major economies, exacerbated by labour shortages and of course, an acute dearth of truck drivers to transport goods and fuel through the internal arteries of the countries concerned. When the world thought that the supply of coal is stabilising, especially in the world’s second largest economy, China, it has been forced to fight on yet another new, unexpected front – a severe cold spell, engulfing over 90% of the vast nation of over 1.1 billion people. The plummeting temperature did not even spare its remotest tropical islands. This has come about defying the pundits who had pre

Factors that moved the crude oil price this week

  Oil price fell slightly this week, having been through unprecedented uncertainty. It, however, neither fell disastrously nor increased dramatically due to outbreaks of the Delta variant of the Covid-19 and projected recovery in global demand respectively. The sole focus of attention was on the OPEC+ meeting that ended on Thursday, November 4. Almost everyone in the crude oil realm expected that the OPEC+ would not be able to ignore the pressure from the main importers such as India and Japan and of course, the US; the hope for a positive outcome, as far as consumers are concerned, got a boost when President Biden waded in personally, but to no avail. Analysts anticipated some ‘retaliatory’ measures in response to official OPEC+ snub; they expected, for instance,   a substantial release of the US Strategic Petroleum Reserves in order to calm down the crude oil markets. It, however, did not happen. On the contrary, the US approved a significant sale of military hardware to Saud

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