FX.co ★ Oil Rises on Falling US Stockpiles

WTI crude oil futures climbed above $62 per barrel on Wednesday, recovering from a decline of over 1% in the previous session. This rebound followed industry data revealing a larger-than-anticipated reduction in US crude inventories. Specifically, the American Petroleum Institute (API) disclosed a decrease of 2.4 million barrels last week, exceeding the forecasted 1.2 million-barrel drop, indicating stronger demand. Despite this positive development, gains remained limited due to ongoing geopolitical events. Market participants are closely monitoring potential peace talks between Russia and Ukraine, which could lead to eased sanctions on Russian oil and subsequently increase global oil supply. Concurrently, Chinese refineries have purchased 15 shipments of Russian oil for October and November deliveries, stepping in amidst a decline in Indian demand, underscoring the robustness of Russia's exports despite existing sanctions pressures. The potential Russia-Ukraine peace agreement, more lenient enforcement of secondary sanctions, and increased output from OPEC+ have all played a role in recent market softness, pushing oil prices to nearly a three-month low, with a decline of over 10% so far this month.