Oil prices trading flat for the third day
2023.02.01 11:16
Oil prices trading flat for the third day
By Tiffany Smith
Budrigannews.com – While the market is awaiting a decision on the U.S. interest rate and data on and fuel stockpiles later on Wednesday, oil prices remained relatively stable after OPEC and its allies maintained their output policy.
By 1419 GMT, futures were at $85.33 a barrel, down 14 cents, or 0.1%. U.S. crude futures on West Texas Intermediate (WTI) advanced $79.00 by 13 cents, or 0.2 percent.
At a virtual meeting on Wednesday, ministers from the Organization of the Petroleum Exporting Countries (OPEC) and allies, including Russia, kept their output policy the same.
A Reuters survey found that the 10 OPEC members were pumping 920,000 barrels per day (bpd) below OPEC+ targeted volumes in January as Iraqi exports fell and Nigerian output did not recover.
The deficit was greater than the December deficit of 780,000 bpd.
In another place, the Deputy Prime Minister of Russia stated that he anticipated an increase in oil demand as a result of Chinese economic activity.
PVM analyst Stephen Brennock stated that lower U.S. rate hike expectations supported oil prices. Oil priced in the dollar is less expensive for buyers holding other currencies when the U.S. currency is weaker.
At 1900 GMT, the Federal Reserve of the United States is expected to announce its interest rate decision.
According to market sources, U.S. crude stocks increased by approximately 6.3 million barrels in the week ending January 27, exceeding expectations based on data from the American Petroleum Institute. API/S] According to Julius Baer economist Norbert Ruecker, “Commercial storage in North America is ample.”
“Prices have recently risen as a result of the improved mood in the market, but this support ought to be temporary. In line with the expectations of the futures market, we anticipate lower prices in the long run.”
WTI is trading in contango, indicating a current oversupply because front-month delivery contracts are trading higher than later deliveries.
Brent is in the opposite market structure, a shallow backwardation.
