- The WTI price rises to about $ 67.00 in the first Asian session on Thursday.
- The increase in tensions in the Middle East drives the price of WTI.
- Crude oil stocks in the US fell at 3,644 million barrels in the week ending on June 6, according to EIA.
The West Texas Intermediate (WTI), the referent of the US crude oil, is being negotiated around $ 67.00 during Thursday’s Asian negotiation hours. The price of the WTI rises to a maximum of two months in the midst of geopolitical tensions increased in the Middle East.
Reuters reported Wednesday that the United States is planning a partial evacuation of its embassy in Iraq and will allow military dependents to leave places in the Middle East, citing security risks in the region.
Meanwhile, US President Donald Trump said he is losing confidence that the US and Iran can reach an agreement on the nuclear program. Trump added that the US would not allow Iran to have a nuclear weapon. The increasing geopolitical tensions could raise the price of the short -term WTI.
The weekly report of the Energy Information Administration (EIA) showed that crude oil stocks in the US for the week that ended on June 6 fell to 3,644 million barrels, compared to a drop of 4,304 million barrels in the previous week. The market consensus estimated that stocks would increase by 100,000 barrels.
Trump said the commercial agreement with China is ‘made’, but there were missing details and confirmation by China. Petroleum operators will closely follow developments around commercial conversations between the US and China. The economic uncertainty caused by Trump’s tariff policy could drag the 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.
