Oil Prices Climb Up To Cover Losses but Oversupply Issues Still Prevail
After facing a dull day, the crude oil prices went up on Thursday trying to recover from its loss. Kuwait has commented earlier that it has hopes to extend the OPEC deal much beyond the middle of this year. This has helped the investors to put their hopes in oil prices once again.
Brent crude oil was traded at $53.34 which gained 0.77% from yesterday. The WTI crude futures also gained 0.63% as it was trading at $50.76.
Joining Kuwait, Saudi Arabia had also commented that it will comply with the Organization of Petroleum Exporting Countries (OPEC) if it proposes extending the oil production cut deal. Russia is also keen on reducing oil production and it is urging other non-members to consider the same. The current OPEC deal expires in June and oil producers are hoping to extend the deal beyond June.
Last week, the US crude stock inventory report stated that the oil stocks went down by 1 million barrels with inventory stocks rounding up to 532.34 million barrels. The traders felt that the Energy Information Administration (EIA) report has helped the oil price to go up.
In the previous session, oil prices dropped by 3.5% as EIA reported that the gasoline inventories went up to meet the high demands of summer gasoline. Traders are worried that OPEC deal won’t help in increasing oil production as long as US refineries continue to increase their oil production. The continuous increase in gasoline stocks indicates that the demand is not as strong as the expectation.