Market traders are currently basing their oil price valuations on the expected outcomes from the OPEC+ meeting.
On the other side of the fence, another price puller is the crude stockpile data.
In a report by the US Energy Information Administration, crude inventory build came at 21.60 million barrels for the week ending February 26.
The result is significantly higher than the report findings from the API inventory. They showed a rather conservative build amounting to 7.36 million barrels.
Both results failed to come into terms with analysts’ expectations. A 1.85 million barrel draw from API and EIA’s forecast of a 1.3 million build-up.
On the other hand, the sluggish crude performance is compensated by the unforeseen decline in gasoline stocks amounting to 9.93 million barrels.
Industry experts note that what both sectors are experiencing is a “temporary cut” due to an unprecedented disruption and not an overall increase in orders.
Both gasoline and distillate productions had significant impact from the disruption in operations brought by the cold spell in Texas.
Prices have dropped conservatively in Wednesday’s Asian session before reverting to gains.
In the latest charts, Brent crude futures contract added 27 cents to $64.34 per barrel. The European benchmark rests steadily above the $64 threshold after gaining for two consecutive sessions.
Following the upward trend, the West Texas Intermediate added 19 cents to $61.47 per barrel.
OPEC’s Decision will be a Market Mover
Meanwhile, the other half of the market is pricing based on the expected movements from the OPEC+ meeting happening later in the day.
Spectators are hopeful that member states would finally increase outputs and ease production curbs amid the recovering global demand.
Analysts are estimating 500,000 barrels per day supply increase for March. They are hoping that top exporter Saudi Arabia will end its self-imposed 1 million bpd supply easing.
Many countries in the world, including key economies, have successively adopted more relaxed restrictions amid the continuous rollouts of vaccines.
With this, the influx of demand for black gold is highly likely in the market.
On the other hand, insiders reported that the association might trudge the production cut through April to sustain or accelerate price higher.
Similarly, this is under the assumption that the overall demand for crude oil is still relatively fragile, with some of the key demand supporters still close for business.
This assumption has support from EIA’s crude oil barrel build report for last week.