Fundamental analysis
25 August, 2022
Oil prices rose on Thursday on mounting supply tightness concerns amid disruptions to Russian exports, the potential for major producers to cut output, and the partial shutdown of a U.S. refinery. Both crude oil benchmark contracts touched three-week highs on Wednesday after the Saudi energy minister flagged the possibility thatthe Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, will cut production to support prices. Also, discussions on an agreement on Iran's nuclear programme remain stalled, calling into question any resumption of its exports, although talks are continuing. In the United States, the world's biggest oil consumer, BP reported shutting some units its Whiting, Indiana, refinery after an electrical fire on Wednesday. The 430,000 barrel-per-day plant is a key supplier of fuels to the central U.S. and the city of Chicago. Falling U.S. crude and product stockpiles also added to the upward pressure on prices. Oil inventories fell by 3.3 million barrels in the week to Aug. 19 at 421.7 million barrels, steeper from analysts' expectations in a Reuters poll for a 933,000-barrel drop.
