TOKYO, Sept. 30 (Reuters) – Oil prices were mixed on Thursday as sales driven by an unexpected rise in US inventories eased, with analysts predicting that supply may not keep pace with recovering demand.
Brent crude was down 8 cents at $ 78.56 a barrel at 6:15 a.m. GMT, after falling 0.6% on Wednesday. US oil rose 11 cents to $ 74.94 a barrel, after also falling 0.6% in the previous session.
US stocks of oil and fuel rose last week, the US Department of Energy’s Energy Information Administration (EIA) said on Wednesday.
Crude inventories (USOILC = ECI) rose 4.6 million barrels in the week of Sept. 24 to 418.5 million, according to EIA data, compared to analysts’ expectations in a Reuters poll for a decrease of 1.7 million barrels.
Both contracts swung into higher territory earlier in the session, after two days of losses, with oil bulls perhaps looking for the next barrier to break after Brent broke above $ 80 for the first time in three years. Tuesday.
âThe underlying physical fundamentals remain favorable, with the gradual ramp-up of OPEC + supply still lagging behind the recovery in demand,â Citigroup Global Markets analysts said in a note.
Citigroup predicts that oil balances will be in deficit by 1.5 million barrels per day on average over the next six months, even with a continued increase in supply.
Next week, the Organization of the Petroleum Exporting Countries and its allies, including Russia, a group known as OPEC +, are expected to pledge to add 400,000 barrels per day (bpd) to their November production.
The increase in US inventories came as production in the Gulf has returned to about the levels it had before Hurricane Ida hit about a month ago. Production rose to 11.1 million barrels a day last week, but U.S. drillers have not been so quick to turn on the taps after being criticized by shareholders for rapid and loose expansion in the past.
The electricity crisis and housing market concerns in China have also affected morale recently, as any fallout for the world’s second-largest economy would likely have impacted demand for oil, analysts said.
âThe demand for fuel switching in the power generation sector could even increase the deficit,â Citigroup analysts noted.
China is the world’s largest importer of crude and its second-largest user after the United States.
Reporting by Aaron Sheldrick; Editing by Ana Nicolaci da Costa and Tom Hogue
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