Oil prices soar to 14-month high amid supply crunch

September 28, 2023 (MLN): Oil prices closed at their highest level since August 2022 on Wednesday, while the US dollar index (DXY) continued its upward climb.

Brent crude is currently trading at $97.35 per barrel, up by 0.83% on the day.

While West Texas Intermediate crude (WTI) is trading at $94.6 per barrel, up by 0.98% on the day.

Both benchmarks jumped by more than 3.5% yesterday, taking the total gain in just the last 3 months to around 40%.

Moreover, oil prices are up around 35% since the US wanted to refill its Strategic Petroleum Reserves (SPR).

The rise came on the heels of a surprising drop in US crude inventories. Oil prices have been trending higher following moves by Russia and Saudi Arabia to limit output, as APP reported.

Analysts cited the rise in crude prices as a drag on US equities, which opened higher, but finished mixed as oil prices surged and bond yields reversed.

"We've got a lot of trends going on in the background that are creating a difficult environment for investors -- obviously rising interest rates to rising oil prices, and there is a stronger dollar," said Jack Ablin, chief investment officer at Cresset Capital Management.

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