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Despite the energy crisis in Europe and Asia, and the alleged gas to oil switching as a result, rising crude oil stocks in the United States have just tanked WTI prices to a 4-week low.
WTI prices briefly slipped below $80 per barrel, landing at $80.15 (-4.48%) at 4:42 p.m. EDT.
WTI started to drift lower shortly after the Energy Information Administration’s (EIA) Weekly Petroleum Status Report (WPSR) was published at 10:30 a.m. EDT. According to the EIA, crude oil inventories grew by 3.3 million barrels for week ending October 29.
The report followed another sober data point on Tuesday by the API, which showed a 3.6 million barrel build to crude oil—the sixth straight such build according to the industry body.
The high crude oil and gasoline prices in the United States as of late have presented quite a political challenge for President Biden, who has been quick to lay the blame for the high prices at OPEC’s doorstep. Meanwhile, the U.S. President has taken every opportunity to ask OPEC to turn on the taps and increase production more than the group has planned, which is for a 400,000 bpd increase in production per month.
With the API and EIA now behind us for the week, oil prices will be at the mercy of OPEC+, which will meet on Thursday to discuss their plan going forward. The general sentiment in the market is that OPEC+ will stick to its planned production cut easement of 400,000 barrels per day. This increase is likely already priced into the market.
The last time WTI prices were this low was on October 8.
Brent crude, for its part, had fallen to $81.37, down 3.95% on the day at 4:55 p.m. EDT.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.