Oil edged lower after capping the longest run of gains in more than four years as OPEC+ leaders extended supply cuts to the end of 2023.
(Bloomberg) — Oil edged lower after capping the longest run of gains in more than four years as OPEC+ leaders extended supply cuts to the end of 2023.
West Texas Intermediate fell near $87 a barrel after posting nine daily gains, the longest stretch of advances since January 2019. That surge, which propelled futures into overbought territory, came as Saudi Arabia and Russia pledged to prolong their export curbs through the fourth quarter.
Traders will get an official snapshot of US inventories later Thursday. Ahead of that, the industry-funded American Petroleum Institute reported that crude inventories fell by 5.5 million barrels last week, according to a person familiar with the figures. Nationwide inventories are already at the lowest this year.
Crude faces headwinds from wider markets, with the dollar on track for an eighth consecutive week of gains, which would be the longest run of increases in data going back to 2005. For now though, a stronger physical market — underscored by a robust curve structure — is leading sentiment, with prices near their highs for the year.
“While some can argue that messaging from the kingdom earlier this week is a stark reminder to short sellers to not position against the Central Bank of oil, some may argue that the recent physical market tightness is artificial rather than organic market forces at work,” RBC analysts including Michael Tran and Helima Croft said in a note, referencing Saudi Arabia.
To get Bloomberg’s Energy Daily newsletter direct into your inbox, click here.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.