Oil prices were boosted by a larger-than-expected build in US crude stocks on Tuesday.
USOIL: Weekly Chart
USOIL is holding the support level identified and may now move to test the support above $80, with the moving average also there.
The latest data from the API said crude oil inventories in the United States increased by 3.026 million barrels after falling by 4.382 million barrels in the week prior.
Analysts were expecting a smaller increase of 200,000 barrels, while the total number of barrels of crude gained this year is almost 35 million barrels, according to the API’s data, yet the net draw in inventories since April is more than 12 million barrels.
On Monday, the US Department of Energy (DoE) said it had sold another 400,000 barrels of crude in the week ending July 7 from the Strategic Petroleum Reserve (SPR). That led to a 15th consecutive weekly drop and brought US oil supplies to a new 40-year low of 346 million barrels.
Gasoline inventories were up for a second week by 1 million barrels, and EIA data also said crude production in the US rose to 12.4 million bpd, up 200,000 bpd since the start of the year.
Tomorrow will bring the EIA’s own inventory data for USOIL, and investors will continue to focus on economic growth and supplies. OPEC will come into play later, but the group will want to see oil back near $80, and investors should focus on the long side for a potential low.
Global demand for energy is forecast to rise by 23% through 2045, OPEC Secretary General Haitham al-Ghais told a Nigerian oil and gas conference this week.
“Global primary energy demand is forecast to increase by a significant 23% in the period up to 2045, which means we will need all forms of energy,” he said.
“We will require innovative solutions such as carbon capture, utilisation, and storage and hydrogen projects in addition to a circular carbon economy, which has received a positive endorsement from the G20.”
