By Adedapo Adesanya
Crude oil prices extended their rise on Wednesday as the Energy Information Administration (EIA) reported an inventory decline of 6.7 million barrels in the United States for the week to June 25.
This development pushed the value of the Brent higher by 37 cents or 0.49 per cent to $75.13 per barrel and moved the West Texas Intermediate (WTI) higher by 39 cents or 0.53 per cent to $73.86 per barrel.
Both benchmarks recorded their seventh monthly gain in the past eight months with the global benchmark making an 8 per cent rise while the WTI rose more than 10 per cent in June.
Business Post reports that in the previous week, the stockpiles stood at 7.6 million barrels, indicating a decline for the sixth straight week as refiners ramped up output in response to rising demand.
A day earlier, the American Petroleum Institute (API) had reported a crude oil inventory draw of over 8 million barrels for last week.
Analysts had expected the EIA to report an inventory draw of 4.686 million barrels for the week to June 25.
This is coming as the market anticipates the outcome of this week’s meeting of the Organisation of the Petroleum Exporting Countries (OPEC+) scheduled for today, July 1.
The alliance is reportedly expected to consider adding between 500,000 and 1 million barrels per day, but analysts said some talk may consider no increase.
There was also a boost to the price of the black gold when reports pointed out that the market could fall back into an oil glut after the group reverses its current 5.8 million barrels a day of production cuts by April 2022.
Despite this, the market could witness demand rise by 6 million barrels per day in 2021, according to an earlier OPEC forecast, with 5 million barrels per day of that coming in the second half of this year.
Concern about the spread of the latest coronavirus variant is also dampening optimism but not enough to arrest oil’s rally.
Britain recorded a further 26,068 cases of COVID-19 on Wednesday, the highest daily figure since January 29 and sending the seven-day tally up by 7o per cent. In Asia, Latin America, and some parts of Europe, there is a continuous surge in the Delta variant of the virus.
Dipo Olowookere