Crude oil prices rose marginally during trading today, Wednesday, April 5 (2023), supported by expectations of a decline in US crude inventories, as well as the latest production cut targets set by the OPEC + alliance.
The rise in prices for the fifth session in a row comes after the decision of 9 of the OPEC + coalition countries, led by Saudi Arabia, to make voluntary production cuts of 1.66 million barrels per day, as a precautionary measure aimed at supporting the stability of the oil market.
The OPEC+ pledges raised the total size of the alliance’s cuts to 3.66 million barrels per day, including a cut of two million barrels in October, equivalent to about 3.7% of global demand.
Crude oil prices today
By 07:56 AM GMT (10:56 AM Mecca time), Brent crude futures for June 2023 delivery rose 0.38%, recording $85.26 a barrel.
West Texas Intermediate crude futures – for May 2023 delivery – also increased by 0.26%, recording $80.92 a barrel, according to what was seen by the specialized energy platform.
And crude oil prices ended their dealings, yesterday, Tuesday, April 4, on the rise, to continue to reap gains for the fourth consecutive session, supported by OPEC + moves aimed at stabilizing the markets.
global oil supplies
The rise in crude oil prices comes at a time when an industrial report showed that US crude inventories fell by about 4.3 million barrels in the week ending March 31.
The official inventory report is scheduled to be released by the US Energy Information Administration at 02:30 PM GMT (05:30 PM Mecca) on Wednesday.
The continued addition of support was the latest supply-cutting targets set by the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, a group known as the OPEC+ alliance.
“Energy traders are still digesting the sudden production cut in OPEC + and any news indicating that the oil market will remain tighter will lead to higher prices,” said OANDA analyst Edward Moya.
Oil market analysis
In Asia, data showed that Japan’s services sector grew in March at the fastest rate in more than 9 years.
However, weak manufacturing activity in the United States and China – the two largest oil consuming countries – has prevented crude oil prices from rising further, despite the possibility of supply tightening after the OPEC+ cuts.
Traders will look for clues about broader economic trends from the US non-farm payrolls data, due later this week, analysts say.
“The US non-farm payrolls are likely to be the most influential economic data leading to broad market movements,” said CMC Markets analyst Tina Ting, according to Reuters.
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