Oil Updates – Crude Falls as Israel Embargo Concerns Ease and Venezuela Sanctions Ease
TOKYO: Oil prices fell on Thursday, reversing gains from the previous session, after the Organization of the Petroleum Exporting Countries showed no signs of support for Iran’s call for an oil embargo on Israel and that the United States is considering easing sanctions on Venezuela to allow more oil to flow. circulate on a global scale.
Brent crude futures for December fell 0.3 percent, or 29 cents, to $91.21 a barrel. U.S. West Texas Intermediate futures for November, which expire on Friday, were almost flat at $88.34 a barrel, up 2 cents from its settlement price.
The more active December WTI contract fell 0.2%, or 13 cents, to $87.14 a barrel as of 9:45 a.m. Saudi time.
Oil prices rose about 2 percent in the previous session on concerns about disruptions to global supplies after Iran called an oil embargo on Israel over the conflict in Gaza and after the United States, the world’s largest oil consumer, reported a larger-than-expected stockpile. draw, adding to already tight supplies.
OPEC has no immediate plans to act on Iran’s call, sources told Reuters, easing concerns about possible disruptions.
Israel imports about 250,000 barrels of oil per day, mainly from Kazakhstan, Azerbaijan, Iraq and African countries, Citi analysts said in a note.
“We believe that an embargo from Kazakhstan and Azerbaijan, a strong ally of Israel, is unlikely,” they said.
Prices also retreated as U.S. President Joe Biden’s visit to Israel ended without a further escalation of the conflict between Israel and Hamas, said Tina Teng, an analyst at CMC Markets.
“But the market remains under upward pressure due to geopolitical tensions,” she said.
Still, prices were pressured by news that the United States issued a six-month license allowing transactions in OPEC member Venezuela’s energy sector after a deal was reached between the Venezuelan government and the country’s political opposition to ensure fair elections in 2024.
Venezuela’s oil flows could help depress global oil prices, rising amid the Israel-Hamas conflict, sanctions against Russia and the move by OPEC and its allies – known as of OPEC+ – to reduce production, but the South American country needs investments to increase its production. after years of sanctions.
Japan, the world’s fourth-largest crude buyer, on Thursday urged Saudi Arabia and other oil-producing countries to increase supplies to stabilize the global oil market, as rising fuel prices amid the conflict could have an impact on the global economy.
U.S. crude oil and fuel oil inventories fell last week due to growing demand for diesel and heating oil, according to data from the Energy Information Administration. Distillate inventories fell by 3.2 million barrels during the week of Oct. 13, to 113.8 million barrels, according to EIA data.
Crude stocks fell by 4.5 million barrels to 419.7 million barrels, while gasoline stocks fell by 2.4 million barrels to 223.3 million barrels.
Supply could tighten further as Russian oil exports through its western seaports are expected to fall by some 300,000 b/d in November, with domestic refineries expected to increase quantities as seasonal maintenance ends, sources said to Reuters.