Oil prices get breathing room following an unexpectedly large decline in U.S. crude inventory

April 26, 2023 (MLN): Oil prices recovered on Wednesday after last session’s sharp decline of around 2%, owing to the latest reports showing an unexpectedly large decrease in U.S. crude inventories.

Brent crude is currently trading at $80.94 per barrel, up 0.54%. West Texas Intermediate crude (WTI) is trading at $77.51 per barrel, up by 0.52%.

American Petroleum Institute (API) showed U.S. crude oil stocks fell by 6.1 million barrels in the week ending April 21.

Official stockpiles data from the U.S. government is expected to be released Today.

Song Yang, an analyst from China Galaxy Futures, noted that the upward momentum from the OPEC cut was beginning to wane and that Russian oil exports had not shown any clear signs of decrease, leaving the supply side with no further support, as Reuters reported.

Despite the API data providing a boost to the market on Wednesday, investors are remaining cautious due to concerns regarding the economy and expectations of further interest rate hikes that could curb fuel demand growth.

The U.S. Federal Reserve, the Bank of England, and the European Central Bank are all expected to raise rates at their upcoming meetings, with the Fed meeting scheduled for May 2-3.

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