Oil climbed in Thursday morning Asia trade as U.S. crude stockpiles fell by the most since the end of May, while exports hit a record high, reported Bloomberg. The U.S. Federal Reserve’s dovish stance on future rate hikes also supported the commodity.
What Happened: U.S. crude stockpiles dropped by 4.52 million barrels last week, while exports surged to a record high of 4.55 million barrels per day, according to the Energy Information Administration.
The drop in stockpiles was due to increasing overseas demand on higher discounts for U.S. crude as against the international benchmark Brent. The spread between WTI and Brent has been increasing as supply concerns continue to haunt the European market following reduced Russian gas flows.
Price Movement: WTI futures rose 1.56% to over $98.7/barrel, while Brent futures rose 1.23% to $107.93/barrel.
Expert Comments: Will Sungchil Yun, a Seoul-based senior commodities analyst at VI Investment Corp said Fed Chair Jerome Powell’s comments eased some inflationary concerns, improving the overall appetite for risk assets, including oil. “Crude will likely continue to trade around $100 a barrel,” Yun said, according to Bloomberg.
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