Oil prices rise amid global concerns over energy supply
U.S. oil prices rose to the highest level since 2014 for the fifth day on Wednesday amid global concerns over energy supplies amid signs of tightness in the crude oil, gas and coal markets.
Brent oil prices rose for its fourth day on concerns over supply, especially after OPEC+ decided on Monday to increase production gradually rather than increase production further as it was planned before.
West Texas Intermediate (WTI) oil previously rose to $79.18 per barrel, reaching its highest level since November 10, 2014. The market was up 0.15%, or 12 cents, to $79.05 a barrel at 0128 GMT.
Brent crude rose 0.15%, or 12 cents, to $82.68 a barrel after hitting a three-year high in the previous session.
On Monday, OPEC+ agreed to stick to the July agreement to increase production by 400,000 barrels per day (bpd) each month until at least April 2022, and phased out existing production cuts.
Crude oil boosted its gains as the energy crisis boosted demand, as concerns about market tightness were spurred on.
The decision of OPEC+ was well below what the market expected given the worldwide energy crisis. As expected, there is speculation that if demand continues to rise, OPEC will have to act before the next scheduled meeting.
Late last month, the OPEC+ Joint Technical Committee (JTC) said it expects a supply gap of 1.1 million bpd this year, which could translate into a 1.4 million bpd surplus next year.
Oil prices have surged more than 50% this year, adding to inflationary pressures that crude-consuming nations such as the United States and India are concerned will derail recovery from the COVID-19 pandemic.
Inventory data from the United States, the world's largest consumer of oil, show some signs that fuel demand is slowing, while OPEC+ is concerned that the fourth global wave of COVID-19 infections could hit demand recovery, despite pressure to ramp up production.
Some sources are reporting that US oil inventories increased by 951,000 barrels in the week through October 1, and gasoline and distillate fuel stocks are also increasing.
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