Oil prices fell from 2014 peak, supply limited losses

Oil prices corrected on Thursday after hitting their highest since 2014 in the previous session on strong demand and short-term supply disruptions, losses-limiting fundamentals, investors are locking in. word. Brent oil futures fell 72 cents, or 0.81%, to $87.72 a barrel, by 0152 GMT. The global benchmark hit $89.13 a barrel in the previous session, the highest since October 2014. 4,444 U.S. West Texas Intermediate (WTI) crude futures fell 96 cents, or 1.1. %, down to $86/barrel.

“The International Energy Agency says global oil demand is on track to reach pre-pandemic levels,” analysts at ANZ Bank said in a note. “Short-term supply disruptions are also helping to tighten the market. Brent crude rose sharply after reports that a key pipeline linking Iraq to Turkey was destroyed due to an explosion.”
Crude oil flows through the KirkukCeyhan pipeline, however, have resumed, after being disrupted on Tuesday by an explosion near the pipeline in Turkey’s southeastern province of Kahramanmaras, the authorities said on Wednesday authorities. Supply issues increased this week after Yemen’s Houthi group attacked the United Arab Emirates, the Organization of the Petroleum Exporting Countries’ (OPEC) third-largest producer. Meanwhile, Russia, the world’s second-biggest oil producer, has built up a large military presence near Ukraine’s border, stoking fears of invasion and supply uncertainties.

Oil prices underpin a broad-based recovery in fuel demand after the coronavirus pandemic. OPEC officials and analysts say that an oil rally could continue in the coming months and prices could reach $100 a barrel as demand weakens due to the spread of the Omicron COVID19 variant. OPEC+, which combines the cartel with Russia and other producers, is struggling to meet its monthly output increase target of 400,000 bpd (bpd).

U.S. gasoline and crude oil inventories rose while distillate inventories fell last week, according to market sources citing data from the American Petroleum Institute on Wednesday. Crude inventories increased by 1.4 million barrels for the week ending January 14. Gasoline stocks rose by 3.5 million barrels, while distillate stocks fell by 1.2 million barrels, according to the source, who asked not to be named.