3% drop for US crude, 2.5% losses for natural gas

The three-day uptrend in oil ended on Wednesday, with both US crude and Brent prices falling sharply as a result of the increase in US stocks for the third consecutive week and the strengthening of the dollar.

As reported by the US Energy Information Administration (EIA) earlier today, US crude reserves strengthened in the week ended November 5 by 1 million barrels, although yesterday the American Petroleum Institute reported a reduction of reserves by 2.5 million barrels

Although the increase in stocks announced by the EIA was smaller than analysts had expected, it was enough to push lower oil prices, which had risen in recent days, boosted by strong demand and OPEC’s decision to maintain unchanged its decision to gradually and carefully increase its production by 400,000 barrels per day.

On the other hand, the EIA reported that weekly gasoline stocks fell by 1.6 million barrels, while refined stocks fell by 2.6 million barrels.

This development has increased the estimates that the government of President Biden may release part of the strategic US crude reserves in order to mitigate the rise in fuel prices, an estimate that also hit oil prices.

West Texas Intermediate crude for December delivery fell $ 2.55, or 3%, to close at $ 81.60 a barrel on the New York Mercantile Exchange.

Brent crude traded slightly lower at $ 1.90, or 2.2%, at $ 82.88 a barrel on the New York Mercantile Exchange.

Gasoline and heating oil futures traded lower on Wednesday, with the December contract for gasoline losing 3% to $ 2,304 a gallon and December delivery heating oil falling 2.1% to $ 2.455 gallon.

Yesterday’s heavy losses were extended today by natural gas, with the December contract losing an additional 2.5% and today stands at $ 4,855 per million British thermal units.