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Oil prices have made strong gains on Wednesday, after US data showed a sharp fall in US crude stocks, and the EU’s embargo on Russia after it unveiled a new embargo package..
Brent crude was up about $ 5 a barrel at $ 109.96, while US West Texas Intermediate crude was up 3.9% at $ 107.62..
U.S. crude oil stocks fell 3.48 million barrels last week, the U.S. Petroleum Corporation said yesterday, showing a drop in the supply of the world’s largest oil consumer..
The European Commission has announced a number of sanctions against Russia, including a phased ban on Russian crude oil within six months and a ban on refined products by the end of 2022..
US Secretary of the Treasury Janet Yellen said: “We must do all we can to control the revenue that Russia can get from selling oil.”.
Yellen added, “The EU’s move to reduce Russian oil imports could push up crude prices. We need to see how this can be done.”.
Two sources in OPEC + said that the coalition’s technical committee, which includes key oil producers, closed its meeting on Wednesday and did not change its forecast for demand growth..
Earlier today, four OPEC + representatives told Reuters that the group’s ministers were expected to agree tomorrow, Thursday, to increase the target for oil production for June to 432,000 barrels a day..
According to the agreement reached in July last year, the alliance is set to increase production targets by 432,000 barrels per month until the end of September to end the remaining production cuts..
At the end of March, the Coalition agreed to move forward with the planned production increase for May.
This week’s OPEC + meeting comes in the wake of a key announcement by the European Union, which on Wednesday proposed a phase embargo on Russian oil, in its austerity measures that have not yet punished Moscow for its war in Ukraine..
OPEC Secretary-General Mohammed Barcinto told Reuters at a meeting of the OPEC + Joint Technical Committee today that other producers could not replace Russian products..
“It is clear that Russia’s oil and other liquid exports cannot be reimbursed more than seven million barrels a day,” he added. No excessive production capacity.
But he said, “However, it is clear that their potential loss through sanctions or voluntary action affects energy markets.”
Oil prices rose more than four percent to about $ 110 a barrel, according to the European Union..
A report seen by Reuters on Wednesday said the OPEC + Alliance expects a surplus of 1.9 million barrels per day in 2022, an increase of 600,000 barrels per day from previous estimates..
The report, prepared ahead of a meeting of the OPEC + Joint Technical Committee, expects oil stocks in the Organization for Economic Co-operation and Development to be slightly above average in 2015-2019..
The revision of the estimate reflects weak growth in demand for oil, which was adopted by the Organization of the Petroleum Exporting Countries (OPEC) in its monthly report on crude oil for April..
OPEC now expects global oil demand to increase by 3.67 million barrels per day by 2022, down 480,000 barrels per day from its previous forecast. Barquinto said China’s locks restrict the use of transport fuels and petrochemicals..
“Some people point out that this has affected oil demand because the country has been facing the biggest shock in oil demand since the beginning of 2020,” he told the technical team.
OPEC + expects average oil production from non-OPEC countries, averaging 18.2 million barrels a day, 600,000 barrels a day lower than previously expected, somewhat reflecting the decline in Russia’s supply..
According to a document by the Russian Ministry of Economy, Russia expects its output to fall by 17 percent by 2022..
According to the document, Russian oil production could fall from 433.8 million to 475.3 million tonnes per day in 2022 to 8.68 million to 9.5 million barrels per day, from 524 million tonnes in 2021..
US oil stocks
The U.S. Energy Information Administration said on Wednesday that oil reserves in the United States recorded a sharp rise last week, similar to that of gasoline and distillate stocks..
U.S. crude oil stocks rose 1.3 million barrels to 415.7 million barrels, down 829,000 barrels in the week ended April 29, compared to analysts’ expectations, according to a Reuters poll..
Crude oil reserves at a distribution center in Cushing, Oklahoma, increased by 1.4 million barrels, according to the Energy Information Administration..
Crude consumption at U.S. refineries fell 218,000 barrels a day last week, and refinery operating rates fell 1.9 percentage points..
U.S. petrol stocks fell 2.2 million barrels last week to 228.6 million barrels, while 589,000 barrels were expected to fall..
Distillation stocks, including diesel and heating oil, fell 2.3 million barrels last week to 104.9 million barrels, which is expected to fall 1.3 million barrels..
Net imports of US crude rose 545,000 barrels a day last week to 2.76 million barrels a day, according to the Energy Information Administration..
Russia’s crude oil imports from India
On Wednesday, India continued to support the purchase of Russian oil, arguing that it was part of a long-term effort to diversify its supply and that a sudden halt in imports would push up global prices and hurt domestic consumers..
Inspired by the discounts, the world’s third-largest crude importer bought oil from Russia, which occupied Ukraine twice as much as it did in 2021, prompting Western sanctions to prevent many oil importers from trading with Moscow..
The European Union, Russia’s largest buyer of energy, has proposed a phased end to imports of Russian crude oil and refined products by the end of 2022..
In defense of its strategy, India has made it clear that European countries continue to import large quantities of oil from Russia and that Russian crude oil accounts for a small percentage of the country’s consumption..
The Ministry of Petroleum and Natural Gas said, “India has been hit by the continuing rising prices by some oil suppliers, which is pushing India to diversify its procurement resources.”
In order to expand its supply basket, India has said that its companies have been purchasing energy in various quantities from Russia for some years..
As India is a major buyer of crude oil, it is now abruptly moving away from its diversified sources and focusing on the remaining resources in the already restricted market, which could lead to greater volatility, volatility and a sharp rise in international prices, ”the ministry said. In a statement.
“Despite trying to paint a different picture, energy purchases from Russia are very low compared to India’s total consumption,” the ministry added. India’s formal energy deals cannot be politicized. Energy flows are not yet allowed. “
Russia is India’s largest arms supplier, and New Delhi has not publicly denounced Moscow as its own military operation in Ukraine..
India gets most of its energy needs from West Asia and offers to sell more than the US pushes New Delhi out of Moscow. Asia’s third-largest economy consumes about five million barrels of crude a day, and Russia has purchased at least 40 million barrels of oil in the past two months..
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