- The price of the WTI rose, supported by new US sanctions to Iran and growing signals of an adjusted supply.
- The American Petroleum Institute (API) reported a reduction of 4.6 million barrels in US crude oil inventories last week.
- President Trump expressed optimism about the ongoing trade negotiations between the US and China, highlighting the encouraging progress in discussions.
The price of oil West Texas Intermediate (WTI) extends its rebound for second consecutive session, quoting around $ 63,90 per barrel during the Asian hours on Wednesday. The continuous increase in oil prices is produced in the midst of new sanctions from the United States (USA) to Iran and signs of a adjusted supply.
On Tuesday, the US imposed new sanctions aimed at Seyed Asadoollah Emamjomeh, an important actor in liquefied petroleum gas (LPG) Iranian and the transport of crude oil, together with its corporate network. According to the US Treasury, the Emamjomeh group has facilitated the export of hundreds of millions of dollars in Iranian oil products to international markets, according to Reuters.
Adding to the bullish impulse, US oil inventories showed a strong decrease. The American Petroleum Institute (API) reported a reduction of approximately 4.6 million barrels last week, according to market sources. The official data of the Energy Information Administration (EIA) will be published on Wednesday, with Reuters analysts forecasting an average decrease of 800,000 barrels.
Crude oil prices were also supported by a more optimistic mood in the market. On Tuesday, the Treasury Secretary, Scott Besent, described the current tariff stagnation as “unsustainable”, hinting at a possible relief of commercial tensions. Meanwhile, US president Donald Trump reassured markets by stating that he has no plans to dismiss the president of the Federal Reserve, Jerome Powell, helping to relieve concerns about the independence of the Central Bank.
President Trump also adopted an optimistic tone about commercial conversations between the US and China, pointing out advances in negotiations. Although it ruled out extreme tariff increases – affirming that they would not reach 145% – he confirmed that tariffs would not be completely raised. The White House indicated that efforts are being made to negotiate trade agreements aimed at reducing the wide tariffs introduced earlier this month.
WTI FAQS oil
WTI oil is a type of crude oil that is sold in international markets. WTI are the acronym of West Texas Intermediate, one of the three main types that include the Brent and Dubai’s crude. The WTI is also known as “light” and “sweet” by its relatively low gravity and sulfur content, respectively. It is considered high quality oil that is easily refined. It is obtained in the United States and is distributed through the Cushing Center, considered “the crossing of the world.” It is a reference for the oil market and the price of WTI is frequently traded in the media.
Like all assets, supply and demand are the main factors that determine the price of WTI oil. As such, global growth can be a driver of the increase in demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can alter the offer and have an impact on prices. OPEC decisions, a group of large oil -producing countries, is another key price factor. The value of the US dollar influences the price of WTI crude oil, since oil is mainly traded in US dollars, so a weaker dollar can make oil more affordable and vice versa.
Weekly reports on oil inventories published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect the fluctuation of supply and demand. If the data show a decrease in inventories, it can indicate an increase in demand, which would raise the price of oil. An increase in inventories may reflect an increase in supply, which makes prices lower. The API report is published every Tuesday and that of the EIA the next day. Their results are usually similar, with a 1% difference between them 75% of the time. EIA data is considered more reliable, since it is a government agency.
The OPEC (Organization of Petroleum Exporting Countries) is a group of 13 nations oil producing that collectively decide the production quotas of member countries in biannual meetings. Their decisions usually influence WTI oil prices. When OPEC decides to reduce fees, it can restrict the supply and raise oil prices. When OPEC increases production, the opposite effect occurs. The OPEC+ is an expanded group that includes another ten non -members of the OPEC, among which Russia stands out.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
