Oil edges up as US stockpile report counters rising supply concerns

Oil prices rose marginally on Wednesday, bouncing off two-month lows hit in the prior session after an industry group reported U.S. crude stockpiles fell last week.
Brent crude rose 20 cents, or 0.3%, to $73.22 a barrel by 0430 GMT. U.S. To $69.11, West Texas Intermediate crude oil futures gained 18 cents, or 0.3 percent. U.S. crude stocks fell 640,000 barrels in the week ended February 21, market sources said on Tuesday, citing American Petroleum Institute data. Official U.S. stockpile data is due later on Wednesday. [EIA/S] [API/S] “If confirmed by the EIA later today, it would mark the first decline in U.S. crude oil inventories since mid-January,” said ING commodities strategists in a note on Wednesday.
Reuters polled analysts and found that U.S. crude stocks had increased by 2.6 million barrels last week. On the supply side, prospects for a peace deal between Russian and Ukraine are improving, said ING, while the market also eyed the potential implications of a minerals deal between the U.S. and Ukraine.
The ING strategists stated, “This would take us a step closer to the lifting of Russian sanctions, removing much of the supply uncertainty hanging over the market.” The U.S. and Ukraine agreed terms of a draft minerals deal central to Trump’s efforts to rapidly end the war in Ukraine, sources familiar with the matter told Reuters on Tuesday.
After pushing oil prices down by more than 2% on Tuesday, gloomy economic reports from the United States and Germany halted price gains. Brent crude closed at its lowest since December 23, while WTI recorded its lowest settlement since December 10. Consumer confidence fell at its sharpest rate in three and a half years in February, according to U.S. data, and 12-month inflation expectations rose. Meanwhile, the German economy shrank in the last three months of 2024 versus the prior quarter.
Oil prices have been buffeted by concerns that U.S. President Donald Trump’s decisions about tariffs against China and other trading partners could add to pressure on the country’s economy.
That has eased worries about tighter near-term oil supply despite fresh U.S. sanctions against Iran, ANZ Bank analysts wrote in a note to clients.
According to Commodity Context analyst Rory Johnston, OPEC+ members hoping to bring more supply to the market in the coming months counter any loss in supply from the Middle Eastern nation, even though U.S. policy measures could drive a reduction of up to 1 million barrels per day in Iranian crude exports.