SULAIMANI (ESTA) — Oil prices rose on Thursday from a three-week low touched in the previous session after consuming nations announced a huge release of oil from emergency reserves, with worries over tight supply still clouding the market outlook.
Brent crude futures climbed $1.51 to $102.6 a barrel at 0646 GMT, while U.S. West Texas Intermediate (WTI) crude futures rose $1.33 to $97.56 a barrel.
International Energy Agency member countries on Wednesday agreed to release 60 million barrels on top of a 180 million-barrel release announced by the United States last week to help drive down prices in a tight market following Russia’s invasion of Ukraine, according to Reuters.
But analysts and traders said even with the emergency oil stocks release, supply remained tight.
“The oil release from the IEA members reflects strong political determination against Russia oil over its invasion of Ukraine, but it’s not enough to fill the actual supply shortage,” Reuters quoted a Shanghai-based oil trader as saying.
State refiners in China, the world’s top oil importer, are honoring existing Russian oil contracts but avoiding new ones despite steep discounts, heeding a call for caution by Beijing, Reuters reported.
“In addition to the enormous global reserves release, demand destruction and recession are currently the only price-lowering mechanism in a world devoid of inventory buffers,” Stephen Innes, managing director of SPI Asset Management, told Reuters.
