Futures on US West Texas Intermediate Crude Oil touched highs unseen since August 2022 on Thursday, after a sharp drop in US crude inventories additionally amplified concerns over global supply tightness stemming from OPEC+ production cuts.
Data by the US Energy Information Administration showed on Wednesday that crude oil stocks had decreased by 2.17 million barrels in the week ended on September 22nd, after another 2.13 million barrel draw in the prior week. Analysts on average had expected a much smaller decline – by 0.32 million barrels.
Crude stockpiles at the Cushing, Oklahoma, storage hub decreased by 943,000 barrels last week to under 22 million barrels – a level not seen since July 2022.
The drop in inventories to near historic lows at that key hub has been a result of strong refining and export demand.
“Stocks are drawing while demand keeps growing. We are still far away from a price level causing demand destruction,” Stefano Grasso, senior portfolio manager at 8VantEdge, was quoted as saying by Reuters.
The draw in US crude stockpiles came after Saudi Arabia and Russia earlier in September extended their combined 1.3 million barrels per day of supply cuts until the end of the year.
As of 10:13 GMT on Thursday WTI Crude Oil Futures for November delivery were edging down 0.26% to trade at $93.44 per barrel. Earlier in the session, the black liquid rose as high as $95.03 per barrel.
At the same time, Brent Oil Futures for December delivery were edging down 0.47% on the day to trade at $93.92 per barrel.