Oil prices rise after 4 days of declines
Oil prices rose on Wednesday to make up for previous losses, as oil remained in decline for four consecutive days, and this rise was supported today by fears of geopolitical supply disruptions and a larger-than-expected decline in US oil inventories.
WTI futures rose above the levels of USD 65 per barrel, while Brent crude rose by a similar percentage, exceeding USD 69.
Bullish factors: supply concerns and falling inventories
Trump's threats and the deadline for Russia:
The approach of US President Donald Trump's deadline for a ceasefire between Russia and Ukraine scheduled for Friday has raised fears of supply disruptions, especially with Trump's threats to impose tariffs on India if it continues to import Russian oil.
Trump on Tuesday warned of an increase in tariffs on Indian imports within 24 hours, believing that low energy prices could prompt Russian President Vladimir Putin to end the war.
US oil inventories decline:
Data from the American Petroleum Institute (API) showed an unexpected decrease in US crude inventories by 4.2 million barrels last week, compared to market expectations that indicated a decrease of only 1.8 million barrels, reflecting stronger than expected demand.
Downward pressure: OPEC production increase and oversupply
On the other hand, the increase in OPEC production limited oil gains, as the alliance announced plans to raise production by 547 thousand barrels per day in September, ending the last package of production cuts that had been in effect for months.
Market forecast: between geopolitical tensions and the balance of supply and demand
Analysts expect fluctuations in oil prices to continue as the situation develops between the United States, Russia and India, as US sanctions may disrupt Russian oil flows, which may push prices higher.
However, any negative development in the negotiations or a sudden increase in supplies could put oil back on the downward trajectory.
However, an increase in OPEC production and weak global economic growth may limit the ascent, especially if demand slows down in the coming months.
