Oil prices extended gains on Friday as supplies in Cushing, Oklahoma declined and the tensions in the Ukraine remains in the spotlight.
The Northern American West Texas Intermediate (WTI) crude climbed 0.28% at $101.57 a barrel on the New York Mercantile Exchange at the time of writing. While futures for Brent crude, added 0.03% to $107.88 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude was at a premium of $6.38 to WTI.
US Crude Supplies
Reports from the Energy Information Administration showed that crude inventories in the US advanced by 6.62 million barrels to 382.5 million, higher than analysts’ estimates of a rise of 2.5 million.
According to the Energy Information Administration, supplies at Cushing, Oklahoma, the delivery point for WTI crude; dropped to the lowest in two year. Supplies fell by 1.33 million barrels to 28.5 million in the week ending March 21.
Gasoline consumption climbed by 5.8% in the last week to 9.002 million barrels a day, the highest since December 20, according to reports from EIA. Distillate supplies, including heating oil and diesel, rose by 1.56 million barrels to 112.4 million.
The Organization of the Petroleum Exporting Countries (OPEC) said it would reduce oil production by 620,000 barrels a day to 23.78 million a day in the four weeks ending April 12 in response to the weaker seasonal demand from Asia.
Analysts from Standard Chartered are expecting oil demand growth in the US to slowdown this year as well as demand from India. While China and Europe are expected to slightly boost the demand for oil.
Oil – Ukraine Crises in Spotlight
While the ongoing tension between Ukraine and Russia continues to be in focus, European leaders met with the US President Barack Obama to discuss tougher sanctions on Russia which could have an impact on oil supply to Europe.
The Western nations are working with military, economic and finance sanctions for Russia for its annexations of Crimea from Ukraine.
On Thursday, the International Monetary Fund said it agreed to a $14 billion – $18 billion standby agreement with Ukraine, with an international fund of $27 billion available to the country over the next two years.
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