West Texas Intermediate (WTI), the U.S. crude oil benchmark, traded near $62.15 during Thursday’s Asian session, edging higher on renewed supply concerns following OPEC+’s decision to maintain its current output policy.
The Organization of the Petroleum Exporting Countries and its allies, collectively known as OPEC+, confirmed they will hold crude production quotas steady, reaffirming the production levels established during their December meeting. This announcement provided WTI prices with upward momentum. Market participants are now turning their attention to an OPEC+ meeting scheduled for Saturday, where a potential increase in oil output for July is expected to be discussed.
Adding to the market’s bullish sentiment, the American Petroleum Institute (API) weekly report revealed a significant decline in U.S. crude oil inventories. For the week ending May 23, stockpiles fell by 4.236 million barrels, sharply contrasting the previous week’s 2.499 million barrel increase. Despite this recent drawdown, crude inventories remain elevated year-to-date, rising by more than 21 million barrels, according to API data analysis.
Market optimism over advancing trade agreements that could enhance the U.S. economic outlook may strengthen the U.S. dollar, which could exert downward pressure on dollar-denominated commodities such as oil. Traders will closely monitor the U.S. Energy Information Administration (EIA) weekly crude oil inventory report due later Thursday, along with the second estimate of Q1 U.S. GDP growth, for further direction.
