The WTI gains ground above $ 67,00 in the midst of renewed attacks in the Red Sea

  • The WTI price moves upwards, around $ 67.15 in the first Asian session on Wednesday.
  • The latent conflict in the Red Sea drives the price of WTI.
  • Crude oil inventories in the US unexpectedly increased by 7.1 million barrels last week, according to the API.

The West Texas Intermediate (WTI), the referent of American crude oil, is quoted around $ 67.15 during the first hours of Wednesday’s Asian negotiation. The price of WTI advances in the middle of the renewed huti attacks on navigation in the Red Sea. Petroleum merchants await the US Petroleum Administration inventories report (EIA) of the US, which will be published later on Wednesday.

The conflict in the Middle East between Israel and Iran came to an end last month, when US President Donald Trump announced a truce. However, huti attacks have caused interruptions in the supply of oil and energy and transport systems.

Reuters reported Tuesday night that four sailors of the Bulk Eternity C, Liberian flag and operated by Greeks, were killed in a drone attack and fast boat against Yemen, the second incident in a day after months of calm. The climbing in the Red Sea could boost the price of WTI, since it is a key route for the transport of crude oil from the Middle East to Europe and Asia.

On the other hand, a surprising increase in US inventories last week could limit the rise in black gold. The weekly report of the American Petroleum Institute (API) showed that crude oil inventories in the US for the week that ended on July 4 unexpectedly increased by 7.1 million barrels, compared to an increase of 680,000 barrels in the previous week. The market consensus estimated that inventories would decrease to 2.8 million barrels. So far this year, crude oil inventories have increased by 11 million barrels, according to Oilprice calculations based on API data.

WTI oil – frequent questions


WTI oil is a type of crude oil that is sold in international markets. WTI are the acronym of West Texas Intermediate, one of the three main types that include the Brent and Dubai’s crude. The WTI is also known as “light” and “sweet” by its relatively low gravity and sulfur content, respectively. It is considered high quality oil that is easily refined. It is obtained in the United States and is distributed through the Cushing Center, considered “the crossing of the world.” It is a reference for the oil market and the price of WTI is frequently traded in the media.


Like all assets, supply and demand are the main factors that determine the price of WTI oil. As such, global growth can be a driver of the increase in demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can alter the offer and have an impact on prices. OPEC decisions, a group of large oil -producing countries, is another key price factor. The value of the US dollar influences the price of WTI crude oil, since oil is mainly traded in US dollars, so a weaker dollar can make oil more affordable and vice versa.


Weekly reports on oil inventories published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect the fluctuation of supply and demand. If the data show a decrease in inventories, it can indicate an increase in demand, which would raise the price of oil. An increase in inventories may reflect an increase in supply, which makes prices lower. The API report is published every Tuesday and that of the EIA the next day. Their results are usually similar, with a 1% difference between them 75% of the time. EIA data is considered more reliable, since it is a government agency.


The OPEC (Organization of Petroleum Exporting Countries) is a group of 13 nations oil producing that collectively decide the production quotas of member countries in biannual meetings. Their decisions usually influence WTI oil prices. When OPEC decides to reduce fees, it can restrict the supply and raise oil prices. When OPEC increases production, the opposite effect occurs. The OPEC+ is an expanded group that includes another ten non -members of the OPEC, among which Russia stands out.

Source: Fx Street

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