Crude Oil In Rally Mode After Inventories Surprise

Global Oil Demand To Rise In The Year – IEA

Global Oil Demand To Rise In The Year – IEA

Oil extended gains as investors assessed geopolitical risks with speculation that the US president and Saudi Arabia's crown prince discussed countering the influence of Middle East producer Iran.

"Spot Brent crude oil prices averaged $3.36 per barrel more than WTI prices in 2017 compared with just $0.40 per barrel more in 2016, providing a price incentive to export USA crude oil into the worldwide market", said Matt Stanley, a fuel broker at Freight Investor Services global in a note. Analysts had expected a 2.5 million barrel build.

Commercial crude oil inventories in the US fell 2.6 million barrels, or 0.6 percent, to 428.3 million barrels for the week ending March 16, according to the Energy Information Administration data released earlier.

U.S. West Texas Intermediate (WTI) crude futures for April delivery rose $1.34 to settle at $63.40 a barrel, a 2.2 percent gain.

Perhaps the only fact-related influence over oil prices has to do with the likelihood of the US reimposing sanctions on Iran.

Bermuda police searching for missing St. Joseph's University student
Investigators have not ruled out foul play. "We dearly love our son, we cherish our son", Lisa Dombroski said. The 19-year-old Saint Joseph's University's student had been due to fly back to the US later in the day.

The International Energy Agency said last week Venezuela was "vulnerable to an accelerated decline" and said such a disruption could tip global markets into deficit. Saudi Arabian Crown Prince Mohammed bin Salman is now touring the United States and will meet with US President Trump later today.

For the record, during that meeting on Tuesday, Salman told the brash billionaire he sees a "stable" oil market ahead and added that his kingdom has an 84-year supply of crude.

But even though Tuesday's market performance was more in line with trading activity in 2018 as a whole, the price discrepancy between WTI and Brent worries Matt Stanley, a fuel broker at Freight Investor Services International. However, the shortfall in current Venezuelan production is being made up by record US output. Prices rose $1.37, or 2.1 percent, to $67.42 on Tuesday.

Official US production and inventory data will be released by the Energy Information Administration (EIA) later on Wednesday. The April contract expired Tuesday after adding 2.2 percent to $63.40, the highest close for front-month futures since February 26. A Bloomberg survey ahead of the government report forecast stockpiles rose by 3.25 million barrels.

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