Due to falling demand and a surge in US fuel inventories, oil prices fell on Thursday. Oil fell from its highest level in more than a month.
As of 0727 GMT, the global benchmark Brent crude oil futures fell 63 cents, or 0.8%, to $80.17 per barrel. US West Texas Intermediate (WTI) crude oil futures fell 58 cents, or 0.8%, to $77.27 per barrel.
US crude oil inventories fell last week. Meanwhile, gasoline inventories surged by more than 10 million barrels, the largest weekly increase since April 2020. The decline in fuel demand led to a rebound in refinery supply.
On Monday, the United States reported nearly 1 million COVID-19 cases, setting a global record. The spread of the Omicron variant shows no signs of slowing down, and heavy snow also disrupts traffic.
In addition, the Fed meeting showed that policymakers might raise interest rates faster than market expectations. It also suppressed higher-risk assets such as oil.
On Wednesday, Brent crude oil and WTI crude oil futures climbed to their highest levels since late November, as OPEC+’s decision to increase supply marked the relief of concerns about a large surplus in the first quarter.
OPEC+, an organization that includes members of the Organization of Petroleum Exporting Countries, Russia, and other oil-producing countries, agreed on Tuesday to increase the supply of 400,000 barrels per day (BPD) in February, as it has done every month since August.
At the same time, the company said that TC Energy’s 590,000 barrels/day Keystone oil pipeline resumed operations on Wednesday after a one-day shutdown due to parts of western Canada struggling to cope with the cold winter weather.