The upward trend in crude oil prices persists, with the commodity reaching a 10-month high. Brent crude remains steady at around $92 per barrel. Although there was a slight uptick in American crude inventories, it resulted in a minor dip in crude oil prices. Brent crude hovered at $92 per barrel, while WTI crude remained around $89 per barrel. Last week, US crude inventories saw a 4 million barrel increase.
Crude Oil Prices at 10-Month High
Simultaneously, crude oil prices on the Multi Commodity Exchange (MCX) continue to surpass the 7300 mark. The Energy Information Administration (EIA) predicts that crude prices may remain elevated into the fourth quarter. The anticipation of increased demand in China is bolstering crude oil’s price.
Crude oil prices have risen primarily due to Saudi Arabia’s production cuts. OPEC+ has reduced production this year by 2 million barrels per day (BPD), while a demand of 22 lakh BPD is expected in 2023. Russian oil exports saw a decline of 1.50 lakh BPD in August, despite standing at 72 lakh BPD earlier. Meanwhile, Iran has the potential to produce 30 lakh BPD, and US imports have reached a four-year high.
US Crude Inventories Impact Oil Prices
In response to the surging crude oil prices, the US Energy Department has initiated discussions with producers and refiners to address the situation and ensure a stable crude supply.
In contrast, the outlook for gold remains subdued as it hits a three-month low, with prices falling to $1,905 on COMEX. MCX gold has slipped below 59,000 for the third consecutive day. Rising inflation rates in the United States are exerting pressure on the precious metal, with August’s inflation rate climbing from 3.2% to 3.7%.
Market experts suggest that the likelihood of interest rate hikes in the US in September is minimal, with 97% believing rates will remain unchanged. The US Federal Reserve’s meeting is scheduled for September 19-20.
