On Wednesday, oil prices went up about 3% and hit their highest level in 13 weeks. This was because the U.S. demand for gasoline has kept going up despite record pump prices, people think China’s oil demand will go up, and supply worries are growing in several countries.
At 1:02 p.m. EDT, Brent futures went up $3.59, or 3%, to $124.16 a barrel (1702 GMT). The price of U.S. West Texas Intermediate (WTI) crude went up by $3.49, or 2.9%, to $122.90 per barrel.
Brent and WTI were on track to have their highest settlements since March 8, which were their highest since 2008.
The Energy Information Administration said that refiners’ inputs rose to their highest level since January 2020. At the same time, the amount of crude oil in the Strategic Petroleum Reserve fell by a record amount. go to site
Gasoline stocks in the U.S. dropped by 0.8 million barrels, which was a surprise, because demand for the fuel went up despite sky-high pump prices. Reuters asked a group of analysts, and they thought that gasoline stocks would go up by 1.1 million barrels. ,
“The gasoline draw is a highlight of the report with a tight market place across the U.S.,” said Tony Headrick, an energy market analyst at CHS Hedging. He said that demand was still high even though pump prices were more than $5 per gallon in many parts of the country.
The auto club AAA said that on Wednesday, the average price of regular unleaded gasoline at retail hit a record high of $4.955 per gallon.
“Oil prices are higher, supported by expectation of China easing the COVID restrictions, translating in higher demand and imports this summer,” said Giovanni Staunovo, an analyst at UBS.
The major A-share indexes in China and the Hang Seng in Hong Kong both closed at their highest levels in two months. As restrictions to fight the pandemic are eased in the world’s largest oil importer, oil traders expect fuel demand to rise again.
On the supply side, traders pointed out that a number of countries might have trouble increasing their output.
A number of oil workers in Norway plan to go on strike on June 12 over pay. This could stop some crude production.
State television said that Iran took two International Atomic Energy Agency surveillance cameras out of one of its nuclear facilities, which made the supply outlook even worse.
This move is likely to increase tensions with the UN’s nuclear watchdog, the US, and other countries negotiating with Iran over its nuclear program. These countries are hoping for a deal that could lift sanctions and add 1 million bpd of crude to the world’s supply.
Suhail al-Mazrouei, the energy minister of the United Arab Emirates, said that OPEC+’s efforts to increase oil production are “not encouraging” He pointed out that the group is still 2.6 million barrels per day (bpd) short of its goal.
The International Energy Agency, on the other hand, said that Russia’s invasion of Ukraine could cause Europe to run out of energy next winter.