Overnight, U.S. crude futures surged more than 8% on Wednesday, amid a severely weakening dollar, as energy traders shrugged off a considerable build in U.S. crude futures in favor of growing support for an emergency OPEC meeting aimed at addressing longstanding concerns related to excessive supply.
Light, sweet crude for July delivery moved up 2.4 USA dollars to settle at 32.28 dollars a barrel on the New York Mercantile Exchange, while Brent crude for April delivery gained 2.32 dollars to close at 35.04 dollars a barrel. Prices rose 4.4 percent last week.
“We’ll see higher oil prices” with “supply and demand tightening in the second half of the year”, Chief Executive Officer Bob Dudley said in an interview with Bloomberg Television.
The report from the EIA follows data from the American Petroleum Institute on late Tuesday which showed U.S. crude stockpiles rose 3.8m barrels to 500.4m last week, less than gains in the previous week.
Adding to the buying is renewed hope that Russian and OPEC officials will meet to discuss cutting production to address a glut that has driven prices to around 12-year lows. In the a year ago, speculators had racked up the largest short, or bearish, position in crude oil in history and part of the current volatility in the price has come as a result of some of those positions being closed.
“So I think we should wait for concrete movements not just hearsay”. “Climbing U.S. crude stocks remain an ongoing threat to further price weakness”, ANZ bank said.
Singapore-based BMI Research said in a note Thursday that it expects oil price to remain “low and volatile” in the coming months amid global economic uncertainties and broader financial market distress.
Meanwhile, Iran is aiming for crude exports of 2.3 million barrels per day in the fiscal year beginning March 21, the managing director of the National Iranian Oil Company was quoted as saying on Tuesday.
Last month, the price of oil fell below $30 a barrel, causing the ruble to plunge to record lows.
