WTI crude above $73 as US inventories rise, OPEC output drops

WTI crude oil futures traded just above $73 per barrel on Thursday, recovering from earlier losses as investors balanced a sharp rise in US fuel inventories with concerns about tightening supplies.

WTI crude above $73 as US inventories rise, OPEC output drops

The latest EIA report revealed a nearly 1 million barrel decline in US crude stockpiles last week, marking the seventh consecutive drop. However, gasoline and distillate inventories significantly increased by 6.3 million barrels and 6.1 million barrels, respectively. Meanwhile, OPEC output fell in December after two months of growth, as maintenance in the UAE offset production gains, including a rise in Nigerian output. Russian oil production also fell below OPEC+ targets, with exports reaching their lowest since August 2023.

US cold weather boosts demand, China faces deflation risks

In the US, colder weather is expected to increase heating fuel demand. On the other hand, data from China showed near-zero consumer inflation, signaling weak domestic demand and raising concerns over deflation in the world’s largest consumer.