The Magazine for Asian Investors
Crude oil futures closed higher Wednesday (Sept. 14), responding to forecasts that oil demand will rise in the winter.
- WTI crude futures were up $1.17, or 1.3%, at $88.48 a barrel.
- BRENT crude futures were up 93 cents, or 1%, at $94.10 a barrel.
The International Energy Agency (IEA) forecasts that people will switch from gas to oil as a heating fuel this winter. It is estimated that average oil consumption from October 2022 to March 2023 will be 700,000 barrels per day, double that of the same period last year.
Meanwhile, OPEC forecasts that oil demand will remain strong in 2022 and 2023, driven by the expansion of the big economies.
The forecast boosted the rebound of oil prices into positive territory and also overshadowed the negative results of the EIA report, which showed that U.S. crude oil inventories rose by 2.4 million barrels last week. This was more than analysts had expected, who had anticipated an increase of only 1.2 million barrels.
The market was also driven by expectations of tight oil supplies. The European Union (EU) is preparing for sanctions against Russian oil to come into force on December 5.
The Iran nuclear deal is facing a shambles as Western countries have expressed doubts about Iran’s sincerity in resuming the agreement. If the Iran nuclear deal negotiations fail, it will prevent Iran from exporting oil to the world market again.
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Thursday, September 15, 2022