Oil rises on US inventory drop
An oil tanker passes through the Bosphorus to the Black Sea in Istanbul July 20, 2012. PHOTO: REUTERS
Oil rose by $2 a barrel on Wednesday as a report of lower inventories in the United States and cuts in Russian gas flows to Europe offset concern about weaker demand and a looming US interest rate hike.
US crude oil stockpiles dropped 4.5 million barrels last week as exports surged to an all-time high due to US crude’s big discount to international benchmark Brent, the US Energy Information Administration said on Wednesday.
Brent crude rose $2.15, or 2.1%, to $106.55 a barrel at 1501 GMT. US West Texas Intermediate (WTI) crude gained $2.48, or 2.6%, to $97.46. After a sharp drop in the last two weeks, US gasoline demand rebounded by 8.5% week on week, according to the data.
“All talk about demand destruction stopped in its tracks in this report...the situation has changed dramatically in two weeks,” said Bob Yawger, Director of Energy Futures at Mizuho.
Oil has soared in 2022, reaching a 14-year high of $139 a barrel in March after Russia’s invasion of Ukraine added to supply worries and as demand recovered from the pandemic.
Published in The Express Tribune, July 28th, 2022.
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