Oil prices rise as OPEC declares that the market's fundamentals are sound

 Oil prices rise as OPEC declares that the market's fundamentals are sound

By 0113 GMT, Brent oil futures had increased by 33 cents, or 0.4%, to $82.85 per barrel. WTI oil futures in the United States were also up 33 cents, or 0.4%, to $78.59 a barrel.

Tuesday saw a little increase in oil prices owing to worries that supply may be interrupted if the United States imposes restrictions on Russian oil shipments, as well as an OPEC report that said market fundamentals remained solid.

By 0113 GMT, Brent oil futures had increased by 33 cents, or 0.4%, to $82.85 per barrel. WTI oil futures for the United States were also up 33 cents, or 0.4%, to $78.59 a barrel.

The Organization of the Petroleum Exporting Countries attributed the recent decline in prices to speculators in their monthly report. Additionally, it maintained its relatively high 2024 prognosis while marginally raising its expectation for the rise in global oil consumption in 2023.

Due to worries that demand may decline in the two largest oil users, the United States and China, oil prices fell to their lowest point since July last week. October saw a sharp decline in Chinese consumer prices to levels not seen since the COVID-19 epidemic, and exports declined more than anticipated.

In a report published on Tuesday, ANZ Research analysts said, "OPEC reiterated its view that global supply balances are tight and consumption is healthy in response to the recent bearish sentiment."

However, the report also said that renewed negotiations to reopen an oil pipeline in Iraq may be a hindrance to the market.

In order to restart oil production from the oilfields in the Kurdish area and oil exports from the north via the Iraq-Turkey pipeline, the oil minister of Iraq hopes to come to an agreement with the Kurdistan Regional Government and international oil corporations.

Since March 25, Turkey has stopped exporting 450,000 barrels per day (bpd) of oil from the north via the Iraq-Turkey pipeline due to an arbitration judgment by the International Chamber of Commerce.

A U.S. ban on Russian oil shipments, which may have disrupted supplies, also helped oil prices.

The largest move taken by Washington since a price restriction was set to limit oil payments to Moscow, the U.S. Treasury Department has written notifications to ship management firms demanding information about 100 boats it believes to be in violation of Western sanctions on Russian oil.

In addition, the U.S. government of Energy sold the most oil from the stockpile ever last year, and in order to assist refill it, the government purchased 1.2 million barrels of oil.

Later in the day, the International Energy Agency's most recent monthly report on the oil market is expected to be a focal point for the market.

On Tuesday, U.S. inflation data will also be released; on Wednesday, U.S. producer price index data is anticipated.