Brent slips below $75/bbl on easing supply concerns
The front-month ICE Brent contract has moved $1.49/bbl lower on the day, to trade at $74.81/bbl at 09.00 GMT.
PHOTO: An oil barrel with price charts in the background. Getty Images
Upward pressure:
Brent’s price found some support after the Organization of the Petroleum Exporting Countries (OPEC), in its latest monthly oil market report (MOMR), maintained its oil demand growth forecast at 1.4 million b/d for 2025 and 2026.
The Saudi Arabia-led oil producers’ group has raised demand growth forecast for its crude by 100,000 b/d from January’s assessment to stand at 42.6 million b/d in 2025 and by 200,000 b/d to reach around 42.9 million b/d in 2026.
OPEC has announced plans to gradually start unwinding its ongoing 2.2 million b/d output cut from April. However, it may change the strategy and continue output cuts, depending on market conditions, the group said earlier.
Downward pressure:
Oil supply disruption concerns have eased following reports of upcoming talks between the US and Russia to end the 36-month long conflict in Ukraine.
US President Donald Trump and Russian counterpart Vladimir Putin have agreed to start the negotiations, “sparking optimism that risks to crude oil supplies would ease,” ANZ Bank’s senior commodity strategist Daniel Hynes remarked.
Besides, oil prices took a hit after the US Energy Information Administration (EIA) reported a notable surge in US crude stockpiles.
Commercial US crude oil inventories increased by 4.1 million bbls to touch 428 million bbls for the week ending 7 February, according to data from the EIA. A surge in US crude stocks can indicate a drop in oil demand, which can cap Brent's price rise.
“The EIA’s data on Wednesday showing a third consecutive weekly jump in US crude stockpiles also added downward pressure on crude,” VANDA Insights’ founder and analyst Vandana Hari said.
By Aparupa Mazumder
Please get in touch with comments or additional info to news@engine.online
