Both benchmarks managed to recover as crude supplies for last week came better than expected. Forecasts on oil price are again leaning towards the bullish side.
Brent crude futures contract managed to add 0.26% to $69.14. The European crude is close to hitting a multi-year high of $70.00 per barrel, signifying that demand and supply disparity is now more noticeable than ever.
Following the upward trajectory of its counterpart, the West Texas Intermediate futures hiked 0.14% and hovered above $65.00 per barrel.
In the latest data released by the US Energy Information Administration, the week ending April 30 saw a crude draw amounting to nearly 8.0 million barrels.
Such a figure is significantly better than the 2.3 million barrel build forecasted by analysts earlier.
Meanwhile, gasoline inventories failed to the bandwagon going uphill and reported a 737,000-barrel build for the same period.
According to experts, the recent hike in prices is already showing signs that orders are now more demand-driven.
This is contrary to the trend observed in the past months where the production cuts by OPEC served as the market’s only lifeline.
Currently, strong imports from the world’s two largest economies namely the United States and China are boosting the market.
The two countries reported a faster than expected economic rebound as vaccinations paved the way to the easing of restrictions.
Meanwhile, API inspection coincides with EIA’s weekly report and updated the 7.7 million barrel draw for the same period.
As more economies and business activities begin to pick up, and so will the demand for crude.
Many spectators are hopeful that the incoming months will pose better than expected results for the black gold.
OPEC Leader Cuts Prices for Asia
In an update from OPEC leader, Saudi Arabia, the state-owned Saudi Aramco imposed price cuts for its Asian clients.
The oil behemoth slashed its prices by $0.10 to $0.30 a barrel for June, exclusively for its Asian neighbors.
Analysts are convinced that the recent price cuts are driven by expectations of risks amid the growing number of cases in the world’s third-biggest importer of crude.
Earlier, Saudi Aramco reported a better than expected revenue for the first three months of the year, buoyed by the recovering market demand.
The company also announced dividend distribution to be given in the second quarter of the year.
For the record, Aramco was once the world’s biggest publicly traded firm valued at more than $1 trillion before Apple seized the place.
