Oil prices continued their downward trajectory on Wednesday, influenced by an industry report revealing a substantial increase in US stockpiles.
CFDs on Brent Crude Oil posted an intraday high of $85.26 and intraday low of $84.61. Oil is currently trading at $84.87 (2:49pm Wednesday, 27 March 2024 2024 (GMT+5) Time in Pakistan).
CFDs on WTI Crude Oil posted an intraday high of $81.29 and intraday low of $80.57. Oil is currently trading at $80.77 (2:49pm Wednesday, 27 March 2024 2024 (GMT+5) Time in Pakistan).
US STOCKPILES SURGE
The American Petroleum Institute (API) reported a notable expansion in nationwide stockpiles, indicating a rise of 9.3 million barrels last week, according to sources familiar with the data cited by Bloomberg. Additionally, crude at the Cushing, Oklahoma hub saw a 2.4 million barrel increase, although gasoline inventories witnessed a decline.
Market Impact and Financial Trends
The potential confirmation of these figures by government data later in the day suggests a significant weekly gain in crude levels at Cushing, the largest since January 2023. Concurrently, gasoline inventories are on track to register an eighth consecutive week of decline, representing the longest streak in nearly a year. Weakness in broader financial markets, alongside mixed performance in Asian equity markets, further compounded pressure on crude and other commodities like copper.
Factors Influencing Oil Prices
Oil prices have experienced volatility amidst geopolitical uncertainties stemming from Ukrainian drone attacks on Russian oil infrastructure and ongoing supply cutbacks by OPEC+. While these factors have buoyed prices, challenges such as a subdued economic outlook in China and robust non-OPEC supply growth persist as headwinds.
Market Analysis and Outlook
Analysts anticipate a marginally tighter market in the second quarter, attributed to the extension of OPEC+’s voluntary cuts and an anticipated increase in demand. However, market responsiveness to such measures appears to be diminishing, suggesting a complex and evolving situation for oil prices moving forward.
OIL XTI/USD TECHNICAL ANALYSIS
