Oil Prices Soar as U.S. Crude Stockpiles Decline

Introduction

Oil prices jumped 3% on Wednesday to their highest estimated level in 2023 after a sharp decline in U.S. crude stockpiles raised concerns about tight global supplies.

Brent Crude Futures

Brent crude futures rose $2.59, or 2.8 percent, to settle at $96.55 a barrel and cleared the $97 barrier during the session.

U.S. West Texas Intermediate Crude Futures

U.S. West Texas Intermediate crude futures jumped $3.29, or 3.6 percent, to $93.68. The session high exceeded $94.

Decline in U.S. Crude Stockpiles

Government data showed U.S. crude inventories fell about 2.2 million barrels last week to 416.3 million barrels, well ahead of expectations of a decline of about 320,000 barrels among analysts polled by Reuters.

Lowest Level at Cushing Storage Facility

U.S. oil inventories at the main storage facility in Cushing, Oklahoma, fell 943,000 barrels over the week to below 22 million barrels, the lowest level since July 2022.

Concerns about Remaining Oil Quality

Inventories at Cushing are near record lows due to strong refining and export demand, raising concerns about the quality of the center’s remaining oil and whether it will fall below minimum operating levels.

Source

Source: Reuters + Media