Sunday, October 1, 2023

The price of oil is rising on short-term demand and falling inventories in the US

The barrel of the WTI grade rose 0.6% to close at $81.70; while Brent prices rose 0.5% to trade at $86, according to the New York Mercantile Exchange (NYMEX).

Investors also followed the development of Hurricane Idalia, which made landfall after passing through North Florida with Category 4 winds exceeding 125 miles per hour.

This was announced by the Energy Information Agency (EIA) today “US commercial oil inventories excluding Strategic Petroleum Reserves (SPR) fell 10.6 million barrels from the previous week and totaled 422.9 million barrels, 3% below the last five-year average for this time of year.

Meanwhile, total automotive gasoline inventories are down 200,000 barrels from last week and are about 5% below the five-year average for this time of year.

At the same time, countries in the Organization of the Petroleum Exporting Countries and Their Allies (OPEC+) cartel are expected to decide to extend their voluntary pumping cuts in October, maintaining supply constraints at a time when some minority partners are facing political issues that affect the crude oil supply.

Continued political instability in Libya, with areas of the country in the hands of rebel groups, is threatening the flow of one million barrels a day, industry sources warned.

Also of concern are the military uprisings in the Sahel and Central Africa, where the military coup in Niger was followed by another in Gabon, adding to instability where the main deposits in West Africa are located.

Gabon joined the countries of Niger, Burkina Faso, Sudan, Guinea and Mali where the military has toppled civilian governments.

The military overthrew President Ali Bongo, whose family has ruled the African country for 55 years.

The Economic Community of West African States (ECOWAS) announced its intention to deploy a regional force to “restore constitutional order”, favoring the diplomatic route. However, the military is proposing a transitional period of no more than “three years” before power is returned to civilians.

Natural gas futures contracts for delivery in October traded 5.4% higher to close at $2.81 per million BTU.

Finally, gold prices rose 0.3% to settle at $1,972 an ounce.

World Nation News Desk
World Nation News Desk
World Nation News is a digital news portal website. Which provides important and latest breaking news updates to our audience in an effective and efficient ways, like world’s top stories, entertainment, sports, technology and much more news.
Latest news
Related news