The price of oil was almost unchanged on Thursday after a four-day drop, while market participants continue to assess the prospects for global demand and the latest data on oil reserves in the United States.
A certain pressure on prices is exerted by the strengthening of the US currency. The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) rose by 0.20% to 101.24.
Meanwhile, yesterday the U.S. Energy Information Administration (EIA) announced that crude inventories declined by 4.649 million barrels in the week ended August 16, following an increase of 1.357 million barrels in the previous week. This marked the steepest weekly drop in the U.S. crude inventories since mid-June. Economists had forecast a draw of 2.720 million barrels. At the same time, gasoline stocks fell by 1.606 million barrels. Analysts had expected a slip of 1.000 million barrels. Elsewhere, distillate stocks tumbled by 3.312 million barrels., the most since the week ended March 1 (-4.13 million barrels). Analysts had predicted a gain of 0.040 million barrels. Meanwhile, oil production in the U.S. jumped by 100,000 barrels a day to 13.400 million barrels per day.
Experts said weak global demand and the potential threat on OPEC+ rolling back on their production cuts are putting pressure on oil, but conflict in the Middle East and geopolitical tensions elsewhere are limiting price declines. Overall, the recent drop in prices increases the likelihood that OPEC+ will have to abandon its plans to gradually increase supplies from October and if this is not done, it is likely to put further pressure on prices. Meanwhile, economic conditions in the United States - although favorable for the upcoming easing of the Fed's monetary policy - do not yet provide any special guarantees regarding the prospects for stronger oil demand.