Oil prices remained almost unchanged on 20 November, despite the escalation of tensions in Russia’s war against Ukraine and data on the increase in US oil reserves. This was reported by Reuters.
- Brent is trading at $73.26 per barrel (-$0.05).
- WTI remains at $69.39 per barrel.
Key factors of stability
- Geopolitical risks
The escalation of the conflict between Ukraine and Russia is affecting oil markets. Ukraine has used US ATACMS missiles for the first time, raising concerns about possible disruptions in oil supplies from Russia. “Brent crude oil prices will remain above $70 as the market closely monitors geopolitical developments,” said Yep Jun Rong, market strategist at IG. - Growth of oil reserves in the US
According to the American Petroleum Institute, crude oil stocks in the US increased by 4.75 million barrels, exceeding the forecast of 100 thousand barrels. At the same time, gasoline stocks decreased by 2.48 million barrels, which came as a surprise to analysts who had expected an increase. - China’s imports pick up
China, the world’s largest importer of crude oil, is showing signs of increasing purchases after a period of weak demand. This could offset the negative impact of this year’s weak imports.
Brent’s 20% decline from its April peak ($92 per barrel) is due to a general slowdown in Chinese demand and market volatility. However, analysts expect that the escalating war in Ukraine will continue to weigh on investor sentiment.
Official data on US oil inventories will be released later this week, which may also adjust prices.
