The western oil market is becoming oversaturated.
According to industry statistics released today, the United States is currently experiencing a build-up in crude oil stocks. This comes as world leaders try to increase pressure on OPEC to increase the global oil supply.
Brent crude futures lost 71 cents in value, dropping to roughly $84.00 a barrel. West Texas Intermediate crude futures dropped further, shedding $1.10 in value, leaving them at $82.81 a barrel.
“Crude prices are declining after the API reported the sixth straight week of crude oil inventory builds and as the Biden administration exhausts every possible plea to OPEC+ members before tapping their Strategic Petroleum Reserve,” Edward Moya, a senior analyst at OANDA, told Fox Business.
“World leaders are running out of cards to pressure OPEC+ and that should mean whatever dip that comes from tapping strategic reserves from China or the US will likely be bought into.”
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While the actual prices of oil dropped, gasoline stocks rose. Crude stocks rose by 3.6 million barrels as of last week, and according to analysts, this is well within expectations.
The US Energy Information Administration will be releasing more data on oil usage and supply later today. Meanwhile, OPEC is set to meet tomorrow for a policy review, and it is expected to commit to plans for supply increases.