RIYADH: Oil prices rose on Wednesday after US crude inventories at the nation’s largest storage site hit their lowest level in three years and nationwide fuel stocks fell sharply, a signal of rising demand.
Brent crude futures settled at $85.82 a barrel, a gain of 0.9 percent or 74 cents and the highest since October 2018.
November US West Texas Intermediate crude, which expires on Wednesday, settled at $83.87, up 91 cents, or 1.1 percent. The more active WTI contract for December settled up 98 cents to $83.42 a barrel.
Crude prices have risen as supply has tightened, with the Organization of the Petroleum Exporting Countries maintaining a slow increase in supply rather than intervening to add more barrels to the market, and as US demand has ramped up.
Globally, refiners have been boosting output thanks to high margins, one that can only be restrained by maintenance. US refining capacity use dropped in the most recent week, but analysts noted that supply may continue to tighten if US refiners also pick up processing again.
Emissions cut
Anglo-Australian miner Rio Tinto announced a $7.5 billion plan to reduce carbon emissions by 50 percent by 2030 and forward its target of 2025 for a 15 percent reduction in emissions from 2018 levels.
LNG deals
China has agreed to three huge liquefied natural gas deals with US exporter Venture Global LNG.
According to documents posted on the US department of energy website, the agreements with China’s state oil giant Sinopec include two 20-year deals for a combined 4 million tons of LNG per year.
Germany’s oil imports
German crude oil import volumes fell 7.1 percent from January to August and related lockdowns hit the industry, official data showed on Wednesday.
Oil volumes in Jan-Aug fell to 51.9 million tons from 55.8 million in the same months of 2020, statistics from the BAFA foreign trade office showed.
Forecast
Crude oil prices could reach $100 per barrel in the first or second quarter of next year as global inventories are at their lowest level, the Iraqi oil minister said.
