U.S. oil rises to highest since 2014 amid global energy crunch By Reuters
SINGAPORE (Reuters – U.S. oil price rose on Wednesday for the fifth consecutive day to reach their highest point since 2014. The rise was due to global concern about energy supplies and signs of tightening on crude and coal markets.
Prices also rose for a fourth consecutive day due to supply anxiety after the Organization of the Petroleum Exporting Countries and its allies (known as OPEC+) decided Monday that they would not be increasing their output further but rather say so.
U.S. West Texas Intermediate oil (WTI), rose earlier to $79.18 per barrel, its highest level since Nov. 10, 2014 Market was at $79.05/barrel, up 0.5% (or 12 cents) as of 0128 GMT.
After rising to an all-time high of $32.68 per barrel in the last session, Brent crude gained 0.15% or 12cs (82.68) per barrel.
Monday saw OPEC+ agree to keep its July pact of boosting output by 400,000 barrels per daily (bpd), each month, until April 2022. The agreement also includes phasing off 5.8million bpd from existing production cuts.
“Enduring gains as investors worry about tightness market as the energy crises hikes demand,” ANZ wrote in a statement.
“The market expected a much higher (OPEC+), increase, given the global energy crisis. If demand keeps rising, it is likely that OPEC may have to act before its next meeting.
Last month, the OPEC+ Joint Technical Committee said that they expected a 1.1m bpd supply shortage this year. However, it could become a 1.4m bpd surplus next.
The oil price has risen more than 50% in the past year. Inflationary pressures are causing concern that countries such as India or the United States will impede recovery from the COVID-19 epidemic.
Despite the pressure to increase output, OPEC+ is concerned about a fourth wave of COVID-19 infection in order to slow down demand recovery. This was according to Reuters sources a few hours before Monday’s talks.
But, data on inventory from the United States (the world’s largest oil consumer) showed signs of slower fuel demand.
According to the American Petroleum Institute, U.S. crude oil inventories increased by 951,000 barrels during the week ending Oct. 1. Oilprice.com also reported Tuesday.
The website also reported that gasoline and distillate fuel inventories rose, using API data.
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