- WTI is trading at $88.49 per barrel, up 1.95% on the day, boosted by Saudi Arabia and Russia’s production cuts of 1.3 million bpd.
- OPEC forecasts an increase in oil demand of 2.25 million barrels per day between now and 2024, a sign of strong global economic growth.
- US inflation data due this week could impact WTI prices; A higher-than-expected reading could trigger speculation about a Fed rate hike.
He Western Texas Intermediate (WTI), the US benchmark crude oil, rose more than 2% to a 10-month high in the North American mid-session as oil supplies are expected to remain tight. This, together with supply cuts by oil-exporting countries, supports the price of WTI. At the time of writing, WTI is trading at $88.49 per barrel, up 1.95% on the day.
Oil prices soar on OPEC forecasts and geopolitical factors, while markets watch US CPI.
The latest report from the Organization of the Petroleum Exporting Countries (OPEC) forecasts oil demand to increase by 2.25 million barrels per day (bpd) in 2024. OPEC maintained its strong forecasts for global oil demand growth in 2023 and 2025, suggesting that major economies are stronger than expected.
Saudi Arabia and Russia’s crude oil production cut of 1.3 million barrels per day until December 2023 is the main driver of the recent rise in oil prices. Additionally, flooding and storms in eastern Libya continued to weigh on oil supplies as the four main crude exports remained closed since the weekend.
Meanwhile, Kazakhstan revealed that its oil production fell to 213,8000 metric tons on September 11, from 243,500 tons, as pipeline maintenance work began.
Apart from this, traders are preparing for data released by the US office of the Energy Information Administration (EIA) and the International Energy Agency (IEA). According to a Reuters poll, analysts estimate a drop of 2 million barrels of crude oil in US reserves during the week ending September 8.
Oil traders are also awaiting data from the US Department of Labor, which would reveal inflation figures in the United States. If the data beats estimates to the upside, this could weigh on the WTI price as speculation about another Fed rate hike will increase, which would imply a rise in the US dollar. Otherwise, WTI is expected to continue rising.
WTI Price Action – Daily Chart
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.
