After weekly U.S. crude stocks fell sharply while fuel inventories rose more than expected, Oil Prices settled at $71.31 a barrel on Thursday, down 4 cents after hitting new highs not seen in a year. Brent futures settled at $71.31 a barrel, which was down 4 cents after hitting new highs not seen in a year earlier in the session. U.S. crude ended the day at $68.81 a barrel, down 2 cents. After increasing 1.5 percent in the previous session, WTI prices surged as high as $69.40, the most since October 2018.
Last week, oil inventories in the United States fell by 5.1 million barrels, contrasting to a 2.4 million barrel decline predictions. In comparison, gasoline stocks increased by 1.5 million barrels, and distillate stocks rose by 3.7 million barrels. Bob Yawger, the director of energy futures at Mizuho in New York, said, “They burned through a lot of crude oil though, and we had builds in gasoline and distillate. You don’t want to be burning that much crude and then the customers don’t want it.”
Gasoline consumption soared last month due to panic buying following the closure of the Colonial Pipeline, the country’s most extensive refined products line. This implies that drivers were less likely to fill up their tanks over Memorial Day weekend, which is the start of the busy summer driving season. Oil Prices have surged in recent days as experts, including the Organization of Petroleum Exporting Countries (OPEC) and its allies, have predicted that demand will outstrip supply in the second half of 2021.
On Tuesday, OPEC+ decided to keep plans to lift supply restraints through July, boosting Oil Prices in anticipation of increased demand. The OPEC+ meeting lasted only 20 minutes, the shortest in the group’s history, implying high compliance among members and confidence that the request will return after the COVID-19 pandemic has subsided.