U.S. oil climbed $1.24, or 1.8%, to end at $72.12 a barrel. It hit a session high of $72.19 a barrel, its largest after October 2018.
The world’s largest oil traders said they see oil prices staying over $70 a barrel on Tuesday. According to them, the demand should return to pre-pandemic levels in the second half of 2022.
Vitol Chief Executive Russell Hardy discusses oil moving within $70 and $80 a barrel for the remainder of 2021. He expects the Organization of the Petroleum Exporting Countries and its partners (OPEC+) to keep supply development, even as Iran’s exports may continue if the United States rejoins a nuclear agreement with Tehran.
Trafigura Chief Executive Jeremy Weir told the same event that a fair chance price could approach $100 a barrel. This would be a result of declining reserves before the world comes peak oil demand.
OPEC+ producers have been slowly relaxing record output curbs in recent months.
The decision by OPEC+ to be overly careful in returning supply to the market, whether this is actual caution or intentionally stoking oil prices higher, has been the primary tenant in regarding $73 per barrel Brent, stated Louise Dickson, the oil markets analyst at Rystad Energy.
As stated by two market sources, U.S. crude stocks dropped by 8.5 million barrels in the week closed on June 11, citing American Petroleum Institute figures on Tuesday. As stated by the sources, gasoline inventories increased by 2.85 million barrels, and distillate stocks rose by 1.96 million barrels.
The Data Talks About the Condition of Anonymity
Official government data should come on Wednesday.
Analysts surveyed by Reuters expect U.S. crude stocks to have declined for a fourth week in a row, falling by around 3.3 million barrels last week. Industry data is expected at 4:30 p.m. Tuesday, followed by official figures on Wednesday morning.
Investors and traders are also guarding the outcome of a two-day U.S. Federal Reserve meeting. It should begin on Tuesday, and they will discuss when it will start to scale back monetary stimulus.
The Fed is getting set to debate how and when to reduce a massive asset-purchase program that helped support the U.S. economy during the pandemic.