Crude rallies on surprise stockpile draw

17 Oct 2024 , 10:25 AM

Oil prices recovered in early Asian trade on Thursday, reversing significant losses from the previous two days, as industry data revealed an unexpected decline in US oil stockpiles last week.

The benchmarks have fallen 6-7% this week as the Organisation of Petroleum Exporting Countries (OPEC) and the International Energy Agency reduced demand predictions for 2024 and 2025.

Prices have also declined as risk premiums have cooled, with expectations that Israel’s retaliation attack on Iran might disrupt oil supplies dissipating, while the Middle East situation remains uncertain.

Brent crude prices increased 45 cents, or 0.6%, to $74.67 per barrel, while U.S. West Texas Intermediate crude futures rose 45 cents, or 0.6%, to $70.84 per barrel.

Both crude benchmarks fell on Wednesday, closing at their lowest levels since October 2 for the second day in a row.

Crude oil and fuel stocks declined in the United States last week, according to market sources, citing American Petroleum Institute numbers released on Wednesday, despite forecasts of an increase in crude stockpiles.

Crude stocks declined by 1.58 million barrels in the week ending October 11, according to sources who spoke on condition of anonymity. Petrol inventories declined by 5.93 million barrels, while distillate stocks fell by 2.67 million barrels, they reported.

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