U.S. West Texas Intermediate crude oil futures are edging lower Friday on profit-taking ahead of the week-end and next week’s Christmas holiday. Nevertheless, the market is in a position to finish higher for a third consecutive week on the back of an improving outlook for global demand growth.
As we near the end of the year, one concern for traders was not the impact of the trade war on the global economy, Brexit or a U.S. recession, but rather the thin trading volume. Traders remarked that not even the news of President Trump’s impeachment by the U.S. House of Representatives rattled oil traders.
Several factors helped to underpin crude oil prices this week including lower U.S. supply, the OPEC+ production cuts and demand growth expectations
U.S. Energy Information Administration Weekly Inventories Report
On Wednesday, the EIA reported that U.S. crude supplies fell by 1.1 million barrels for the week-ending December 13. Traders were looking for a decrease of 1.5 to 2.5 million barrels during the period.
The EIA data also showed supply increases of 2.5 million barrels for gasoline and 1.5 million barrels for distillates. Supply for gasoline was expected to climb 2.4 million barrels and distillate inventory was forecast to have risen by 600,000 barrels.
OPEC and Allies Agree to Deeper Production Cuts
Two weeks ago, OPEC and other non-OPEC producers such as Russia agreed to deepen production cuts by a further 500,000 barrels…