- The WTI price rises to $ 69.15 in the first Asian session on Wednesday.
- Crude oil reserves in the US fell to 4.6 million barrels last week, according to the API.
- Trump said he will impose tariffs to countries that buy oil and gas from Venezuela.
The West Texas Intermediate (WTI), the referent of American crude oil, is being negotiated around $ 69.15 during the first Asian session on Wednesday. The price of the WTI expands its increase in a decrease in raw to expected and concerns about a more adjusted global offer due to tariffs threatened by the United States to countries that buy Venezuelan production.
Crude oil reserves fell more than expected last week. The weekly report of the American Petroleum Institute (API) showed that crude oil reserves in the United States for the week that ended on March 14 fell by 4.6 million barrels, compared to an increase of 4,593 million barrels in the previous week. The market consensus estimated that reserves would decrease by 2.5 million barrels.
The US president, Donald Trump, said Monday night that he will impose a 25% tariff to all imports from any country that bought oil or gas from Venezuela, effective as of April 2, as well as new tariffs to the South American country itself. The fears of a more adjusted global offer raise the price of WTI to a maximum of three weeks.
On the other hand, the United States reached agreements with Ukraine and Russia to pause attacks in the sea and against energy objectives, while Washington also tries to relieve certain sanctions against Moscow. A high sea and energy fire between Russia and Ukraine counteracts concerns about a more tight global offer, which could drag the price of WTI downward.
WTI FAQS oil
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
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
