Oil stays close to multi-year highs as energy crisis persists
- Brent and WTI up around 20% since early September
- API shows increasing crude stocks, decreasing fuel stocks – sources
- Official US inventory data released on Wednesday
NEW YORK, Oct. 19 (Reuters) – Oil futures rose on Tuesday and were near multi-year highs as the energy supply crisis continued around the world, while lower temperatures in China increased rekindled concerns about whether the world’s largest energy consumer can meet home heating needs.
The benchmark Brent crude index rose 75 cents to $ 85.08 a barrel. US West Texas Intermediate (WTI) futures rose 52 cents to $ 82.96 per barrel.
Prices have climbed over the past two months. Since the start of September, Brent has risen by around 19%, while WTI has gained around 21%.
“The supply-demand balances show that the market is experiencing a supply deficit, resulting in deep inventory drawdowns and pushing up prices,” said Louise Dickson, senior oil markets analyst at Rystad Energy. “This market tension is expected to continue through most of 2022, and crude oil supply will only catch up with crude demand by the fourth quarter of next year.”
With temperatures dropping as northern hemisphere winter approaches and demand for heating increases, prices for oil, coal and natural gas are expected to remain high, traders and analysts said. .
Colder weather has already started to take hold of China, with near-freezing temperatures forecast for northern areas, according to AccuWeather.com.
Rising prices for coal and natural gas in Asia are expected to lead some end users to turn to lower-cost oil as an alternative.
However, the electricity crisis that is pushing up prices is also hurting China’s economic growth, which has fallen to its lowest level in a year, official data showed on Monday. Read more
China’s daily crude oil processing rate also fell last month, falling to its lowest level since May of last year. Read more
In Brazil, the state-owned oil company Petrobras (PETR4.SA) has confirmed that it will not be able to meet “atypical demand” from fuel distributors in November which exceeded its production capacity, raising fears of fuel shortages. supply in the country. Read more
In the United States, crude inventories rose while gasoline and distillate inventories fell last week, according to market sources citing figures from the American Petroleum Institute on Tuesday.
Crude inventories rose 3.3 million barrels for the week ended October 15. Gasoline inventories fell by 3.5 million barrels and distillate inventories fell by 3 million barrels, according to the data, which requested anonymity.
US government data on inventories is due Wednesday.
(This story has been passed on to correct the fourth paragraph to say that supply will catch up with demand by the fourth quarter of next year, not demand will catch up with supply)
Reporting by Stephanie Kelly in New York; Additional reporting by Bozorgmehr Sharafedin in London Editing by Paul Simao, Matthew Lewis and Mark Porter
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