Oil futures rose on Wednesday, supported by a report that major OPEC+ oil producers may consider extending voluntary production cuts into the second quarter.
Meanwhile, data from the Energy Information Administration revealed a fifth consecutive weekly rise in US crude inventories, along with a decline in gasoline and distillate inventories.
The price moves
-
WTI CL00
+0.30%
For delivery on April CL.1,
+0.30% 24kg,
+0.30%
It rose 23 cents, or 0.3%, to $79.10 a barrel on the New York Mercantile Exchange. -
Brent crude oil for April BRNJ24,
+0.32% ,
The global index rose 39 cents, or 0.5%, to $84.04 a barrel on the ICE Futures Europe exchange. myprint BRN00,
+0.05% Bank24,
+0.05% ,
The most actively traded contract added 18 cents, or 0.2%, to $82.84 a barrel at ICE Futures Europe. -
March gasoline RBH24,
-0.92%
It fell 0.5% to $2.3337 a gallon, while heating oil HOH24 for March fell,
-2.04%
It lost 1.5% to $2.704 per gallon. -
Natural gas delivery April NGJ24,
+2.88%
It traded at $1.865 per mmBtu, up 3.1% in its first full trading day as a front-month contract.
Market driving factors
Reuters reported, citing unnamed sources, that OPEC+, which consists of the Organization of the Petroleum Exporting Countries and its allies, including Russia, is considering extending voluntary production cuts into the second quarter. The voluntary cuts expire at the end of the first quarter, and the report said a decision on the extension is expected in the first week of March.
OPEC+ agreed in November to voluntary cuts of 2.2 million bpd in the first quarter of 2024, with Saudi Arabia extending its voluntary cut of 1 million bpd.
“The focus is gradually shifting to OPEC+’s decision on voluntary production cuts for the second quarter of 2024,” said Ewa Manthey and Warren Patterson, strategists at ING, noting that expectations are that the group may extend current cuts given the decline in crude oil prices. Oil prices.
“Since the voluntary cuts were announced at the end of November 2023, Brent crude oil has traded thinly amid demand concerns and has only recently recovered to November levels” of $83 per barrel, they wrote. “Demand prospects remain weak in the short term due to the economic slowdown and the group may need to maintain cuts to keep the market balanced.”
Merchandise Corner: The war was not enough to raise oil prices. Here's what could spark a big move.
In the United States on Wednesday, the Energy Information Administration reported that US commercial crude oil inventories rose by 4.2 million to 447.3 million barrels for the week ending February 23.
On average, analysts expected the report to show an increase of 2 million barrels, according to a survey by S&P Global Commodity Insights. The American Petroleum Institute announced on Tuesday that crude stocks had risen by 8.4 million barrels, according to a source citing the data.
The EIA report also revealed a weekly decline in supplies of 2.8 million barrels for gasoline and 500,000 barrels for distillates. A survey of analysts conducted by S&P Global Commodity Insights showed expectations of a decrease in inventory by 2.1 million barrels for gasoline and 500 thousand barrels for distillates.
The Energy Information Administration said that US oil production was unchanged in the last week, reaching a record level of 13.3 million barrels per day, while crude oil inventories at the Cushing delivery center in Oklahoma on the Nymex exchange rose by 1.5 million barrels to 31 million barrels.
