Oil prices rose on supply concerns and US stockpile drawdown
The European Union’s decision to impose another round of sanctions targeting Russian oil exports in response to the ongoing war in Ukraine fuelled expectations of reduced global supply. Industry analysts noted that these measures could curb Russian crude flows, lending upward pressure to prices.
Crude oil prices edged higher on Wednesday, December 11, 2024, driven by concerns over the potential tightening of global supply and a significant drawdown in US oil stockpiles.
Brent crude added $1.33 to settle at $73.52/barrel.
WTI rose by $1.70 to close at $70.29/barrel.
The European Union’s decision to impose another round of sanctions targeting Russian oil exports in response to the ongoing war in Ukraine fuelled expectations of reduced global supply. Industry analysts noted that these measures could curb Russian crude flows, lending upward pressure to prices.
Adding to the supply-side concerns, the US Energy Information Administration reported a 1.4-million-barrel decline in crude inventories, further tightening the market outlook.
However, price gains were tempered by revised demand forecasts from OPEC+. The group downgraded its 2024 global oil demand growth estimate to 1.61 million barrels per day (bpd) from the previous projection of 1.82 million bpd. This 210,000-bpd adjustment represents the steepest reduction since August, reflecting the impact of weakened global economic activity on energy consumption.