The price of oil stood tall on its Thursday session after a decline in crude stockpiles in the United States, even if output there is rising. The effort of club OPEC to restrict production is gradually taking effect on the market.
According to the figures from the Energy Information Administration (EIA) on the previous day, commercial crude oil stockpiles in the stateside edged down more than 2.4 million barrels in the entire week to October 27 to 459.9 million barrels. Rivkin Securities’ investment analyst William O’Loughlin said that crude stockpiles in the country went back to the negative territory as Hurricane Harvey disrupted production.
U.S. inventories still fell even if there is an increase in production by 46,000 barrels per day (bpd) to 9.6 million bpd. Crude output in the United States has been rising more than 13 percent since last year. A record of 2.1 million bpd of crude was exported according to the EIA.
Looking at oil futures, U.S. West Texas Intermediate (WTI) crude prices lost as much as 5 cents and settled at $54.25 per barrel from its previous close. However, it managed to rise by 30 percent from its declines this year. Global benchmark for oil prices Brent crude traded close to the flat line at $60.49 a barrel. Just like WTI, Brent also rose by 35 percent from its declines this 2017.
According to some traders, the wide discount of WTI to Brent has made overseas sales more profitable. They also said oil markets were somehow being undermined by the drop of U.S. crude.