NEW YORK: Oil futures slipped on Wednesday as surging US crude inventories weighed on prices, but losses were limited by OPEC’s forecast for robust demand growth.
Brent crude futures fell 4 cents to $82.73 a barrel at 1602 GMT. US West Texas Intermediate (WTI) crude futures were down 12 cents, or 0.2%, at $77.75. US crude inventories jumped by 12 million barrels to 439.5 million barrels last week, the Energy Information Administration said, far exceeding analysts’ expectations in a Reuters poll for a 2.6 million-barrel rise as refiners slowed activity.
“The refinery utilization rate is a pseudo disaster,” said Bob Yawger, director of energy futures at Mizuho. US refinery crude runs fell by 298,000 barrels per day in the week ended Feb. 9, the EIA said, while the utilization rate sank by 1.8% in the week.
On Tuesday, the Organization of the Petroleum Exporting Countries (OPEC) said in its monthly report that global oil demand will rise by 2.25 million barrels per day (bpd) in 2024 and by 1.85 million bpd in 2025. Both forecasts were unchanged from last month.
In other OPEC news, Iraqi Prime Minister Mohammed Shia al-Sudani held a meeting with Saudi Energy Minister Prince Abdulaziz bin Salman, in which he highlighted the importance of coordination between the two countries to maintain stability in oil markets.
Kazakhstan said it will compensate in coming months for its oil overproduction in January, meeting its commitment to OPEC+ production cuts.
Geopolitical factors also influenced oil markets, including conflicts in the Middle East and Russia-Ukraine and the growing view that US interest rate cuts will start later than previously expected. “Currently events around Israel and Gaza, together with Ukraine’s war against Russia, weighs more on sentiment than disappointing US inflation data,” said PVM analyst Tamas Varga.
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