Oil prices rose on Wednesday, despite a likely rise in U.S. oil stocks, on the easing of Chinese Covid-19 related lockdowns and a possible strike by Norwegian oil workers.
Brent crude futures were up $1.43, or 1..2%, at $122 a barrel. U.S. West Texas Intermediate crude was at $120.92 a barrel, up $1.51, or 1.3%.
Market sources said American Petroleum Institute figures on Tuesday showed U.S. crude stocks rose by 1.8 million barrels for the week ended June 3. Gasoline inventories took on 1.8 million barrels, and and distillate inventories rose by 3.4 million barrels.
The World Bank on Tuesday slashed its global growth forecast for 2022 by nearly a third, warning Russia’s invasion of Ukraine had compounded damage from the COVID-19 pandemic, and that many countries now faced recession.
Meanwhile, global crude and oil product supplies remain tight, boosting Asian refiners’ diesel margins to record levels, as Western sanctions hamper exports from major producer Russia.
The CEO of global commodities trader Trafigura said oil prices could soon hit $150 U.S. a barrel and go higher this year, with demand destruction likely by the end of the year.
Most refineries globally are already running close to capacity to meet rising demand from the pandemic recovery and to replace lost Russian supplies.
JP Morgan analysts estimate Russia has cut about 500,000 to 700,000 barrels per day of oil product exports, because it now finds marketing fuel harder than marketing crude.
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