Crude oil prices are recovering during Wednesday’s trading session, especially since the release of the American Petroleum Institute data, which indicate initially the possibilities of a decline in US oil stocks in the Energy Information Administration report expected later today.
And in light of the meetings of the joint ministerial committee of OPEC and its allies and discussing the decision to reduce production, and more importantly is to make recommendations of the optimal size of production cuts during the coming period after the end of the current agreement. Whereas, the volume of production cuts will be reduced to 7.7 million barrels per day, instead of 9.7 million barrels per day during May, June and July.
What supports OPEC’s failure to reduce oil production is the statements of the International Energy Agency, which included that the global demand for oil has started to recover during the last period with more countries lifting the restrictions of the closure, which strengthened the high oil prices in light of the historical reduction in Production, and therefore OPEC + is likely to abide by the agreement and head to reduce production by only 7.7 million barrels.
During yesterday, the data released by the American Petroleum Institute revealed a sharp decline in both American oil stocks and gasoline stocks, compared to the rise in distillate stocks, during the week ending Friday, July 10.
Oil stocks decreased during the past week by about 8.3 million barrels, to reach stocks to about 531 million barrels, compared to expectations of declining stocks by only 2.1 million barrels.
Meanwhile, the American Petroleum Institute data indicated that gasoline stocks fell by about 3.6 million barrels, compared to analysts’ expectations, a decrease of only 643 thousand barrels, according to opinion polls.
While concerns regarding the spread of the Corona virus and its negative impact on the economy persist, the numbers of people infected with the Corona virus (Covid 19) continued to rise during today’s trading.
During the last hours, US crude futures recorded an increase of about 1.07% or $ 0.41 and are trading around the levels of $ 40.67 a barrel. Meanwhile, Brent crude futures rose about 0.89%, or $ 0.38, towards levels of $ 43.30 a barrel.