WTI steadies near $69.00 amid geopolitical risks, rise in US crude Oil stock

• WTI price holds steady near $68.95 in Thursday’s Asian session. 
• US crude stocks rose by more than expected last week, according to the EIA. 
• The conflict between Russia-Ukraine and concern around future oil supply disruptions might help limit the WTI’s losses

On Thursday, the US crude oil benchmark, West Texas Intermediate (WTI), is trading at approximately $68.95. Despite the escalating conflict between Russia and Ukraine, the WTI price remains unchanged due to the small US crude oil inventories that were built last week.

According to the Energy Information Administration’s (EIA) weekly report, crude stocks increased last week, which has a negative impact on the spot price of black gold. The United States’ crude oil stockpiles increased by 0.545 million barrels in the week ending November 15, as opposed to a rise of 2.089 million barrels in the previous week. The market consensus predicted that supplies would rise by 0.400 million barrels.

China is the world’s largest crude importer, and its weak demand for crude oil contributes to the WTI’s decline. In October, China’s crude oil demand decreased by -5.4% year-over-year, according to data that was disclosed earlier this week. The IEA predicts that Chinese demand growth will be a mere 140,000 bpd this year, which is a mere tenth of the 1.4 million bpd demand growth expected in 2023.

Conversely, the WTI price may be bolstered by concerns regarding the potential disruption of oil supplies and the escalating conflict between Russia and Ukraine, which are significant oil producers. Russia’s defense ministry announced on Tuesday that Ukraine employed six ATACAMS missiles to strike a facility in the Bryansk region. Vladimir Putin, the president of Russia, responded by decreasing the threshold for a potential nuclear attack.

“These supply risks are undoubtedly maintaining the support in this region and partially mitigating concerns regarding the global demand outlook,” stated John Kilduff, a partner at Again Capital in New York.