Oil barely changed as the market considered a variety of factors

Oil prices remained steady for a second consecutive day on Wednesday as heightened concerns over potential supply disruptions from Russia, driven by escalating tensions in the Ukraine conflict, balanced against rising U.S. crude inventories and signs of increased Chinese crude imports.

Brent crude futures for January edged up by 11 cents to $73.42 per barrel as of 0730 GMT. Meanwhile, U.S. West Texas Intermediate (WTI) crude futures for December, set to expire on Wednesday, remained flat at $69.39 per barrel, with the more actively traded January contract rising 18 cents to $69.42 per barrel.

The intensifying conflict between Russia, a major oil producer, and Ukraine has provided underlying support to oil prices this week.

"Brent oil prices are likely to remain supported above $70 for now, as the market closely watches geopolitical developments," said Yeap Jun Rong, a market strategist at IG.

On Tuesday, Ukraine reportedly used U.S.-supplied ATACMS missiles to strike Russian territory for the first time, according to Moscow. In response, Russian President Vladimir Putin hinted at a lower threshold for potential nuclear action.

"This escalation in the Russia-Ukraine war renews concerns about supply disruptions in the oil market," analysts from ANZ noted in a client briefing.

On the demand front, U.S. crude oil inventories rose by 4.75 million barrels during the week ending November 15, according to market sources citing data from the American Petroleum Institute (API). This exceeded analysts’ expectations, which had projected an increase of just 100,000 barrels.

Gasoline inventories, however, dropped by 2.48 million barrels, in contrast to forecasts for a 900,000-barrel increase. Similarly, distillate stocks fell by 688,000 barrels over the same period, the sources said.

Official government data is expected later on Wednesday.

In a development boosting oil price sentiment, China, the world’s largest crude importer, appears to have increased its oil purchases this month following a period of subdued imports. Data from vessel tracking firm Kpler suggests that China's crude imports could end November near record highs, an analyst informed Reuters.

China's weak crude imports earlier this year weighed heavily on oil prices, with Brent crude falling 20% from its April high of over $92 per barrel.

 

 

 

 

 

 

 

 

 

 

Paraphrasing text from "Reuters" all rights reserved by the original author.