Oil edged higher after struggling for direction throughout the session as traders weighed rising supplies and a shaky economic outlook.
West Texas Intermediate futures settled little changed near $79. With open interest near January lows, prices saw exacerbated moves that largely followed the path of equity markets. The U.S. Oil Fund ETF reported its biggest daily outflow since 2020 on Wednesday, with more than $180 million pulled from one of the oil market’s largest exchange-traded products.
Oil fell this week amid signs that more barrels could enter the market. The Biden administration is in talks with Venezuela to explore a temporary lifting of sanctions that have hampered its crude sales. This is on top of a rise in Iran’s exports this month.
Also undermining June’s recovery, boosted by supply cuts from Saudi Arabia and Russia, is the deteriorating economic situation in China, signs that US interest rates will need to remain higher for more weather and disastrous economic data in Europe.
Despite this week’s bearish mood, physical markets remain tight. OPEC+ restrictions have helped cause a sharp drop in global oil inventories over the past month, according to Kpler data. And in the United States, crude stockpiles fell 6.1 million barrels last week to the lowest since December, the Energy Information Administration said Wednesday.
Prices:
- WTI for October delivery rose 16 cents to settle at $79.05 a barrel in New York.
- Brent for October settlement added 15 cents to settle at $83.36 a barrel.
