Oil prices rose on Wednesday before an expected rate hike by the Federal Reserve, supported by another decline in US oil inventories as refineries picked up activity ahead of the winter heating season.
Brent crude rose $1.74, or 1.8%, to $96.39 as of 1601 GMT, while US West Texas Intermediate (WTI) crude was up $1.95, or 2.2%, to $90.31 per barrel.
The broader market is likely to remain somewhat subdued ahead of the US Federal Reserve’s post-meeting announcement at 1800 GMT, when the central bank is expected to deliver its fourth, 75 basis points interest rate increase. US crude oil stocks fell about 3.1 million barrels on the week, according to federal data.
US inventories remain low across most products, worrying analysts who believe that the impending end of releases from US strategic reserves will remove a source of supply that will further tighten markets.
“Every week that goes by, the US is drawing hydrocarbon inventories, and that leads to the question of where does the industry turn when there are no more supplies from strategic petroleum reserve releases,” said Andrew Lipow, President of Lipow Oil Associates in Houston. “That is why we are seeing oil prices being supported.
Published in The Express Tribune, November 3rd, 2022.
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