Prices for benchmark crude oil began to rise during trading on Friday, but their weekly fall may be the highest since June, writes Trading Economics. Brent may lose 6.3% by the end of the week, WTI – 5.9%, Market Watch notes.
“Oil does not know what it wants to do today,” said Oanda analyst Edward Moya, who noted that oil prices could decline in two consecutive weeks for the first time since April.
US commercial oil inventories increased by 2.03 million barrels last week, according to a weekly report from the country's energy ministry. Moreover, their growth was observed for the first time in seven weeks. Gasoline stocks fell by 2.95 million barrels, distillates – by 1.68 million barrels.
According to the data of the American Petroleum Institute (API), published the day before, oil reserves in the United States for the week ended September 4 rose by 3 million barrels, distillates – by 2.3 million barrels, while gasoline stocks fell by 6.9 million barrels.
Experts interviewed by S&P Global Platts predicted on average that the data would show a decrease in oil reserves by 500 thousand barrels, gasoline – by 2.5 million barrels and an increase in distillate stocks by 300 thousand barrels.
The continued spread of COVID-19 around the world remains a major constraint on demand, S&P Global Platts notes. The number of detected cases of infection in the world recently exceeded 28 million, more than 907 thousand infected have died.
“A correction in the oil market, in my opinion, is overdue given the slow recovery in demand and increased supply in the short term. However, medium and long term fundamentals suggest limited downside risks,” said AxiCorp analyst Stephen Inns. In his opinion, any drops will be short-term and caused by market sentiment, and by the end of the year oil will rise in price to $ 45 per barrel.
The deterioration in trader sentiment is also associated with signs of another escalation of tensions between Washington and Beijing and worries about sluggish demand due to the continued increase in the number of coronavirus infections.
The cost of November futures for Brent oil on the London ICE Futures exchange by 18:09 Moscow time on Friday is $ 40.31 per barrel, which is $ 0.25 (0.62%) higher than the price at the close of the previous session.
Futures for WTI crude oil for October in electronic trading on the New York Mercantile Exchange (NYMEX) by this time increased in price by $ 0.48 (1.29%) – up to $ 37.78 per barrel.
Earlier in the course of trading, both contracts fluctuated between decline and growth.