- The WTI price reached near $ 70.95 in the early Asian season of Wednesday.
- Trump threatened Russia with oil tariff if Moscow tried to block efforts to end the war in Ukraine.
- According to the API, crude oil stockpile in the US climbed 6.037 million barrels last week.
West Texas Intermediate (WTI), US crude oil benchmark, is trading around $ 70.95 during the initial Asian season on Tuesday. WTI price higher edge amidst the concerns of supply after US President Donald Trump threatened Russia with oil tariffs. However, the reverse for black gold may be limited as traders are hanging for mutual tariffs that Trump is ready to announce on Wednesday.
Trump said on Sunday that he was “urinating” in Russian President Vladimir Putin and would put a secondary tariff of 25% to 50% on Russian oil buyers, if he feels that Moscow is stopping his efforts to end the war in Ukraine. Trump also threatened Iran with bombing and secondary tariffs, if Tehran did not come on an agreement with Washington at his nuclear program. Increasing geo -political risk can disrupt global supply, which can increase the WTI price.
On the other hand, WTI will be under pressure due to Trump’s auto and mutual tariffs. Trump said he would implement “mutual tariff” on Wednesday, suggesting that many countries with their own duties on American goods suddenly face new trade obstacles. The White House did not provide any details about the size and scope of the tariff, which confirms that Trump will impose later during the day.
The American Petroleum Institute (API) Weekly report extended crude oil stockpiles to 6.037 million barrels in the United States for the week ended March 28 compared to 4.6 million barrels of barrels in the last week. According to the oil price calculation of API data, so far this year, the invention of crude oil has climbed around 23 million barrels.
OPEC+ Minister will monitor the meeting of the OPEC+ Minister Committee on Saturday to review the oil merchant policy. According to the sources in the Reuters, OPEC+ plans to increase production per day in May by 135,000 barrels per day. OPEC+ agreed to a similar increase in the output for April.
WTI Oil Question
WTI oil is crude oil sold in international markets. The WTI West is for Texas Intermediate, one of the three major types including Brent and Dubai Crude. WTI is also called “light” and “sweet” due to relatively low gravity and sulfur material respectively. It is considered a high quality oil that is easily refined. It is sour in the United States and is distributed through the Kushing Hub, which is considered the “pipeline intersection of the world”. This oil is a benchmark for the market and the WTI price is often quoted in media.
Like all assets, supply and demand are the major drivers of WTI oil price. For example, global development may be the driver of increased demand and vice versa for weak global development. Political instability, war and restrictions can disrupt the prices of supply and impact. OPEC’s decision, a group of major oil producing countries, is another major driver of value. The value of the US dollar affects the price of WTI crude oil, as the oil mainly trading in the US dollars, thus making a weak US dollar more cheap and vice versa.
Weekly oil inventory reports published by the American Petroleum Institute (API) and Energy Information Agency (EIA) affect the price of WTI oil. Changes in inventions reflect the supply and demand of ups and downs. If the data shows a decline in inventions, it can indicate increased demand, increases the price of oil. High inventions can reflect an increased supply, reducing prices. The API report is published every Tuesday and the EIA after The Day. Their results are usually the same, falling within 75% of the time within 1% of each other. EIA data is considered more reliable, as it is a government agency.
OPEC (organization of petroleum exporting countries) is a group of 12 oil producing countries that collectively set production quota for member countries in annual meetings twice. Their decisions often affect WTI oil prices. When OPEC decides low quota, it can tighten the supply, increase oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an extended group consisting of ten additional non-OPEC members, the most notable of which is Russia.
