Expectations of “OPEC +” supply cuts continue to support oil prices

SINGAPORE (Archyde.com) – Oil prices rose on Thursday on rising concerns over supply shortages amid disruptions to Russian exports, the possibility of major oil producers cutting production and the partial shutdown of a refinery in the United States.
In late Asian transactions, the international benchmark Brent crude futures rose 45 cents, or 0.4 percent, to $101.67 a barrel, while the US benchmark (West Texas Intermediate) crude futures rose 32 cents, or 0.3 percent, to $95.21 a barrel.
Yesterday, the two crudes touched their highest levels in three weeks, in volatile transactions between ups and downs, following the Saudi Energy Minister indicated earlier that the “OPEC +” bloc, which includes the Organization of the Petroleum Exporting Countries and its allies, may reduce production to support prices.
The outcome of the negotiations on the Iran nuclear deal is also still unclear, which raises doubts regarding the imminent resumption of Iranian oil exports. In the United States, the world’s largest oil consumer, BP announced the closure of some units of its Whiting refinery in Indiana following a fire caused by a short circuit yesterday. The refinery, which operates with a capacity of 430,000 barrels per day, is a major supplier of fuel to the central United States and the city of Chicago.
Declining inventories of US crude oil and commercial petroleum products added to upward pressure on prices. Oil inventories fell by 3.3 million barrels in the week ending Aug. 19 to 421.7 million, more than the median forecast of analysts in a Archyde.com poll for a drop of 933,000 barrels.
And US gasoline stocks fell 27,000 barrels to 215.6 million barrels, compared to a previous forecast for a decline of 1.5 million barrels.
Also, US strategic oil reserves fell by more than eight million barrels over the past week to 453.07 million barrels, the lowest level since January 1985, according to data from the Energy Information Administration, which added that US oil production fell by 100,000 barrels per day. to 12 million barrels per day.
Crude exports fell last week to 4.2 million barrels per day, following hitting a record high of 5 million barrels per day in the previous week. Meanwhile, talks are continuing between the European Union, the United States and Iran to revive the nuclear deal. Tehran says it has received a response from Washington to the “final” text drafted by the EU to revive the nuclear deal
Reaching a final agreement in this regard will lead to the start of the return of Iranian supplies to the market without restrictions, which will increase supply in large quantities, but not immediately. However, Iran can begin to export large quantities of its stocks on ships and on land.
OPEC sources told Archyde.com that the production cut by the “OPEC +” bloc would likely coincide with the return of Iranian oil to the market if Tehran concludes a nuclear deal with world powers.