On Thursday, oil prices rebounded as concerns about lower economic growth and demand stagnation weighed against tightening supplies.
Brent crude futures increased 1.76% or 1.85 points to $108.68 per barrel. The international benchmark ticked up from a 0.42% loss to $106.80 per barrel yesterday.
Similarly, West Texas Intermediate oil contracts rose 1.77% or 1.82 points to $104.00 per barrel. Accordingly, it followed a slight Wednesday’s upturn of 0.19% to $102.75 per barrel.
Analysts mentioned that market volatility would pick up again in the near term. Subsequently, the European Union still weighs a ban on Russian oil for its invasion of Ukraine.
The region now speeds up the availability of alternative energy supplies to reduce the cost of banning the Kremlin.
The Organization of the Petroleum Exporting Countries and its allies (OPEC+) produced 1.45 million bpd. This output was below its production target in March as Moscow’s production declined.
Moreover, Libya, a member of OPEC, cited that the country loses about 550,000 barrels per day of oil output. This downdraft is due to blockades at major fields and export terminals.
At the same time, the dampened demand outlook in China continues to pull the sentiment on the market. The world’s biggest oil importer now slowly eases strict COVID-19 restrictions that have hit manufacturing activity and worldwide supply chains.
Then, the International Monetary Fund highlighted risks in Beijing. The financial institution lowered its forecast for global economic growth by nearly a whole percentage point on Tuesday.
The oil market benefitted from the drop in the US crude stockpiles, slashing 8.00 million barrels last week. This reduced inventory is due to a more than a two-year high surge in exports.
US refiners receive last Russian oil cargoes
Furthermore, US refiners received their last Russian crude and fuel oil cargoes in April. This supply would be likely the last one to deliver before a wind-down set by Washington.
The US government set an April 22 ban on imports of the Kremlin crude and refined products. Correspondingly, one crude and eight fuel oil tankers carrying about 6.30 million barrels reached US ports this month.
The world’s largest economy imported 672,000 barrels per day (bpd) of crude and refined products from Moscow last year. This represents 30.00% or 199,000 bpd of oil while 473,000 bpd of refined products.
The blockage exempted Caspian Pipeline Consortium (CPC) crude. It combines the oil from Kazakhstan and Russian oil, usually loaded on the Black Sea.