© Archyde.com. Total oil refinery in France – Photo from Archyde.com archive.
NEW YORK (Archyde.com) – It rose 1% on Wednesday as the International Energy Agency expected an increase in the switch from gas to crude due to higher prices this winter, even though the demand outlook remains pessimistic.
And the global benchmark crude contracts ended a mix to the nearest maturity of the trading session, up 93 cents, or 1 percent, to record at a settlement of 94.10 a barrel.
US West Texas Intermediate crude contracts rose $1.17, or 1.3 percent, to settle at $88.48 a barrel.
The International Energy Agency expects that the sharpening economic slowdown and the faltering Chinese economy will cause global demand for oil to stagnate in the fourth quarter of this year. This has kept prices under pressure recently and may prevent further rises.
The agency also said it expected a large-scale transition from gas to oil for heating, saying it would average 700,000 bpd in October to March 2023 – or twice the level a year ago. This, along with expectations of weak supply growth, is helping to boost the market.
The agency said it had detected a drop of 25.6 million barrels in global oil stocks in July.
But in the United States, crude stocks rose last week for the second week in a row, supported once more by the ongoing releases of crude from the Strategic Petroleum Reserve. The latest government data showed that commercial stocks increased by 2.4 million barrels, with 8.4 million barrels withdrawn from emergency reserves under a program due to expire next month.
The Organization of the Petroleum Exporting Countries (OPEC) said on Tuesday that global oil demand in 2022 and 2023 will come stronger than expected, pointing to signs that major economies are showing better-than-expected performance despite events such as high inflation.
(Prepared by Wagdy Al-Alfi for the Arabic Bulletin)
