- The WTI price falls while Trump and Putin agree on a pause in attacks on energy infrastructure in the war in Ukraine.
- The weekly stocks of API’s crude oil increased by 4,593 million barrels in the previous week.
- Increased violence in the Middle East generates concerns about possible interruptions in the supply in key oil producing regions.
The price of oil West Texas Intermediate (WTI) is maintained under pressure for the second consecutive day, quoting around $ 66.50 per barrel during Wednesday’s Asian negotiation hours. The downward trend is driven by the expectations of an increase in the Russian supply.
On Tuesday, the president of the USA, Donald Trump, and the Russian president, Vladimir Putin, agreed to an immediate pause in the attacks on energy infrastructure in the middle of the war in Ukraine. However, Putin refused to support the largest fire, lasting one month, negotiated by the Trump team with Ukrainian officials in Saudi Arabia, indicating persistent tensions despite the temporary agreement on energy -related attacks.
As one of the world’s greatest oil producers, Russia has seen its production since the war began, largely due to Western sanctions. A possible fire could lead to a relief of these sanctions, which could increase the supply of oil and press prices even more.
Meanwhile, the data of the American Petroleum Institute (API) on Tuesday showed a mixed image for US crude oil stocks. Crude oil reserves increased by 4,593 million barrels for the week that ended on March 14, while gasoline stocks decreased by 1.71 million barrels and distilled stocks fell by 2.15 million barrels.
However, geopolitical tensions in the Middle East continue to support oil prices to some extent. Increased violence threatens to interrupt the supply in key oil producing regions. Trump reaffirmed his administration’s commitment to military action against Yemen’s hutis and warned that Iran would be responsible for any additional attack that interrupted maritime transport in the Red Sea. Meanwhile, Israeli air attacks in Gaza, which ended a high -week fire, resulted in at least 200 victims, according to Palestinian health authorities, Reuters reported.
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.
