Oil Holds Gains above $40 after U.S. Crude Stockpiles Shrink

Shafaq News / Oil Continues to Settle Above the $40/ barrel Level, today, Thursday, on a drop in US crude inventories and the weak dollar which expected to weaken the demand.

The U.S. crude oil stockpiles and distillate inventories last week to the lowest level since April, data from the Energy Information Administration showed.

Crude oil demand is still weak as some European governments re-impose lockdown measures due to Corona virus, while in the United States there are doubts about financial incentives before the election in next November.

 “Demand remains steady at levels well below 2019, which means that prices are unlikely to move higher in this environment,” OANDA's Senior Market Analyst Jeffrey Halley said.

U.S. West Texas Intermediate (WTI) crude CLc1 futures fell 0.1% to $40.17 a barrel at 05:00 GMT, after jumping 2.4% on Wednesday.

Brent crude settled at $ 42.29 on the ICE Futures Exchange, after rising 1.8% in the previous session.

There’s also downward price pressure coming from the supply side, with Libyan output being restored. The North African country is now pumping around 300,000 barrels a day, up from 80,000 at the start of September. In a rare positive for oil prices, meanwhile, a strike at Norway’s biggest oil field could disrupt more than a quarter of the country’s crude production.