Rising Oil Prices Driven by "OPEC+" Limited Decision and Anticipation of U.S. Inventory Data
Global oil markets witnessed a surge today, Wednesday, influenced by a decrease in concerns over supply surplus, following the "OPEC+" alliance's decision to increase production for November at a slower pace than previously anticipated.
In today's trading, the futures contracts for the benchmark "Brent" crude rose by 0.7%, equivalent to 46 cents, settling at a price of $65.91 per barrel. The futures contracts for U.S. "West Texas Intermediate" crude also increased by 0.7%, or 49 cents, reaching $62.22 per barrel. This rise comes after a stabilization session for both crude types the previous day, as investors assessed the market balance between supply indicators and the pace of production increases.
The "OPEC+" alliance, which includes member countries and their allies, decided to raise production by only 137,000 barrels per day, the lowest amount among the options discussed by the group earlier this week, contributing to alleviating concerns of market oversupply.
On another note, analysts at "ANZ" Bank commented on the situation, stating: "Markets will not take the production increase into account unless there are actual signs of weak demand or rising inventory levels," indicating that "prices are likely to stabilize in the near term." The analysts added: "Price gains remain limited as concerns about disruptions in Russian supplies diminish, with Russian crude shipments stabilizing near their highest levels in 16 months over the past four weeks."
In a related context, investors are turning their attention to the upcoming release of official U.S. inventory data from the Energy Information Administration later today. This anticipation follows estimates from the American Petroleum Institute showing an increase in crude inventories in the United States by about 2.78 million barrels during the week ending October 3, while gasoline and distillate inventories declined. The Energy Information Administration also stated yesterday that U.S. oil production is expected to reach a new record high this year, exceeding previous estimates.
