Petroleum prices rose by an American dollar a barrel on Wednesday as a report of lower inventories in the United States and cuts in Russian gas flows to Europe offset concern about weaker demand and a looming U.S. interest rate hike.
Industry group the American Petroleum Institute said on Tuesday crude stocks fell by 4 million barrels, four times the forecast decline. The Energy Information Administration’s official figures were due out for 11:30 a.m. EDT
Brent crude rose 91 cents, or 0.9%, to $105.31 U.S. a barrel. U.S. West Texas Intermediate (WTI) crude gained $1.16, or 1.2%, to $96.14.
Oil has soared in 2022, reaching a 14-year high of $139 a barrel in March after Russia’s invasion of Ukraine added to supply worries and as demand recovered from the pandemic.
Since then, concerns of economic slowdown and rising interest rates have weighed, despite supply outages in Libya and Nigeria and cuts in Russian gas flows to Europe.
Gas flows through the Nord Stream 1 pipeline fell to a fifth of the pipeline’s capacity on Wednesday, while Italy’s Eni said it will receive lower volumes from Russia’s Gazprom.
Later on Wednesday the U.S. Federal Reserve is expected to announce an aggressive rate rise of 75 basis points, a prospect that analysts said was limiting the rally.
