Oil rises on expectation high natural gas to drive switch for heating

- Advertisement -


- Advertisement -

  • API shows US crude stock, fuel stock down for last week
  • US 2021 crude output sees more decline than expected – EIA
  • OPEC slashes 2021 demand, but says gas price hike could help
- Advertisement -

TOKYO, Oct 14 (Businesshala) – Oil prices rose on Thursday, reversing previous losses, on hopes that higher natural gas prices as winter approach may drive the switch to oil to meet heating demand needs. can.

Brent crude futures rose 28 cents, or 0.3%, to $83.46 a barrel by 0107 GMT on Wednesday, after losing 0.3% on Wednesday.

US West Texas Intermediate (WTI) crude futures climbed 22 cents, or 0.3%, to $80.66 a barrel, having fallen 0.3% the previous day.

“Investors bet that rising gas prices will encourage power generators to switch to oil as the winter demand season approaches,” said Hiroyuki Kikukawa, research general manager at Nissan Securities.

The US Energy Information Administration (EIA) said on Wednesday that crude oil production in the United States, the world’s largest producer, was also supporting prices in 2021 due to concerns about a fall in crude oil production. , which was higher than the earlier estimate that it would bounce back. in 2022.

“The current tightness in the crude oil market and the near-term outlook for seasonal demand has supported investor sentiment, driven by a higher than expected build-up in US crude inventories and a weaker demand forecast by OPEC,” Kikukawa said.

The American Petroleum Institute (API) said late Wednesday that US crude reserves rose by 5.2 million barrels for the week ended October 8, according to market sources viewing API data.

Sources said the API also reported that gasoline inventories declined by 4.6 million barrels and distillate stocks declined by 2.7 million barrels.

Analysts in a Businesshala poll had expected crude inventories to rise by 700,000 barrels.

The Organization of the Petroleum Exporting Countries (OPEC) cut world oil demand growth forecast for 2021 in its latest monthly report on Wednesday while maintaining its 2022 outlook.

However, the producer group said rising natural gas prices could increase demand for oil products as end users switch fuels.

EIA will release its inventory report on Thursday at 11 a.m. EDT (1500 GMT).

Reporting by Yuka Obayashi; Editing by Christian Schmollinger

.

- Advertisement -

Stay on top - Get the daily news in your inbox

DMCA / Correction Notice

Recent Articles

Related Stories

Stay on top - Get the daily news in your inbox