Early on Thursday in Asian trading, oil prices increased after hitting multi-month lows the previous day as a result of data indicating sluggish US gasoline demand.
The price of Brent crude futures increased by 53 cents, or 0.6%, to $97.31 a barrel, while the price of West Texas Intermediate (WTI) crude futures increased by 55 cents, or 0.6%, to $91.21. In the prior session, both benchmarks declined to their worst levels since February.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, collectively known as OPEC+, agreed on a modest increase in the group’s output objective, equivalent to around 0.1% of global oil demand, on the supply side.
Without offering specific numbers, the Caspian Pipeline Consortium (CPC), which links oil reserves in Kazakhstan with the Russian Black Sea port of Novorossiisk, said that supplies were drastically down in order to support prices.
Although the United States has asked the group to increase production, spare capacity is constrained and Saudi Arabia may be reluctant to increase production at the expense of Russia, which is suffering from sanctions as a result of the invasion of Ukraine, which Moscow refers to as “a special operation.”
According to the Energy Information Administration, US crude oil inventories unexpectedly increased last week as exports declined and refineries reduced their production. Gasoline inventories also showed an unexpected increase as demand slowed.