Oil prices rise for the sixth consecutive day amid US data and geopolitical tensions
Kyiv • UNN
Brent and WTI crude futures rose by 0.2% and 0.3% respectively, reaching $62.53 and $58.56 per barrel. This increase is driven by strong US economic growth and geopolitical risks, despite an expected annual price drop.
Oil prices rose on Wednesday for the sixth consecutive day, driven by strong US economic growth and the risk of supply disruptions from Venezuela and Russia, although prices were on track for their steepest annual decline since 2020, Reuters reports, writes UNN.
Details
Brent crude futures rose 15 cents, or 0.2%, to $62.53 a barrel by 09:08 GMT (11:08 Kyiv time), while US West Texas Intermediate crude added 18 cents, or 0.3%, to $58.56.
Both contracts have risen about 6% since December 16, when they fell to near a five-year low.
"Over the past week, we've seen a combination of position closures in sluggish markets after last week's collapse failed to materialize, as well as increased geopolitical tensions, including the US blockade of Venezuela, and support from yesterday's GDP data," said IG analyst Tony Sycamore.
US data showed that the world's largest economy grew at its fastest pace in two years in the third quarter, driven by strong consumer spending and a sharp rebound in exports.
Nevertheless, Brent and WTI crude oil prices are forecast to fall by approximately 16% and 18% respectively this year – sharp declines since 2020, when the COVID-19 pandemic undermined oil demand.
"Despite these supply-related risks, oil prices, ... are forecast to show their largest annual decline since 2020, as supply is expected to exceed demand," said MUFG analyst Sujin Kim.
A Haitong Futures report stated that the most significant factor driving oil prices was disruptions to exports from Venezuela, and the ongoing attacks by Russia and Ukraine on each other's energy infrastructure also supported the market.
More than a dozen loaded vessels are in Venezuela, awaiting new instructions from their owners after the US seized the supertanker Skipper earlier this month and struck two more vessels over the weekend.
Last week, US President Donald Trump announced a "blockade" of all sanctioned vessels entering or leaving Venezuela to increase pressure on Venezuelan President Nicolas Maduro.
Meanwhile, US crude oil inventories rose by 2.39 million barrels last week, gasoline inventories increased by 1.09 million barrels, and distillate inventories by 685,000 barrels, market sources said, citing American Petroleum Institute data.