Oil prices: Rose 1% on Wednesday, approaching their April peak. Oil and gasoline product inventories indicated considerable demand since the U.S. consumes the most fuel. This demand offset worries others.
October Brent oil rose 76 cents to $85.67 a barrel at 4:07 GMT. West Texas Intermediate oil prices rose 0.93 percent, or 76 cents, in September. The American Petroleum Institute reported that U.S. oil storage dropped 15.4 million barrels in the week ending July 28th. Analysts projected 1.37 million barrels.
If the U.S. government’s figures match the sector’s later Wednesday, crude oil stocks would fall the most since 1982. API data shows that gasoline storage dropped by 1.7 million barrels, more than the predicted 1.3 million. Diesel fuel storage fell 510,000 barrels, more than experts projected. They anticipated 112,000 barrels less. Americans want gasoline quickly.
Leon Li of CMC Markets stated, “The time when people need the most transportation fuels and when oil-producing countries reduce their supply has increased oil prices
As more people desire crude oil, yet there needs to be more, other countries are storing less. OPEC leader Saudi Arabia has cut oil production significantly. Less oil implies higher pricing.
At a Friday meeting, Saudi Arabia will propose cutting oil production by 1 million barrels per day in September.
Due to Europe’s high unemployment rate, Li believes oil will only move up to $90. After the summer demand was high, oil prices stopped rising.
This week’s PMI may reduce fuel sales. This prevented price increases throughout the session. China, the largest oil customer, may purchase less if prices rise, which kept costs down throughout the session.
Instead of matching demand, China bought crude oil to seize chances. Philip Jones-Lux of Sparta Commodities says political changes may alter supply constraints, which drive the market.