Brent moves lower as market awaits US crude oil stocks data

The front-month ICE Brent contract has declined by $0.55/bbl on the day, to trade at $62.97/bbl at 09.00 GMT.

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Upward pressure:

Risks from Ukrainian drone strikes on Russian energy facilities and escalating US–Venezuela tensions have contributed to upward pressure on Brent futures.

“Crude oil prices rose after a terminal in the Black Sea was damaged. One of three moorings on a pipeline linking Kazakh oil fields to Russia’s Black Sea coast was damaged by a Ukrainian attack,” said ANZ Bank senior commodity strategist Daniel Hynes.

A senior US official said President Donald Trump has been consulting his top advisers on the pressure campaign against Venezuela. On Saturday, Trump said the airspace above and surrounding Venezuela should be considered “closed in its entirety,” though he gave no further details, according to Reuters.

“The US is also widening its campaign against Venezuela, raising concerns that oil exports may be further impacted,” Hynes added.

On Sunday, OPEC+ reaffirmed a small production increase for December and paused further hikes in the first quarter of next year because of growing fears of a supply glut. The decision remains supportive for oil prices in the near term.

Downward pressure:

Mixed sentiment around US crude and product stock levels has put pressure on oil prices.

Market watchers are now looking ahead to the US Energy Information Administration’s weekly inventory report, due Wednesday.

By Tuhin Roy

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