Oil Prices Rise as Investors Evaluate U.S. Market Trends

Oil prices experienced a decline as investors reacted to recent forecasts and geopolitical tensions. On February 12, 2023, Brent crude oil futures dropped by 30 cents to settle at $69.10 per barrel. Similarly, U.S. West Texas Intermediate (WTI) crude saw a decrease of 23 cents, closing at $64.40.

Global Oil Demand Outlook

The International Energy Agency (IEA) recently revised its global oil demand projection for 2026, indicating a slower rise than previously anticipated. The agency highlighted a notable surplus in the market, despite supply disruptions that occurred in January.

The decline in oil prices followed the release of the IEA’s monthly report, which offset earlier gains driven by concerns over U.S.-Iran relations. The lower demand forecast added pressure to the market.

U.S.-Iran Tensions

Geopolitical factors remain critical in shaping market dynamics. U.S. President Donald Trump confirmed ongoing discussions with Israeli Prime Minister Benjamin Netanyahu regarding Iran. Trump noted that no conclusive agreements had been made, but negotiations with Tehran would persist.

In light of unresolved tensions, Trump mentioned the possibility of deploying a second aircraft carrier to the Middle East if necessary. Specifics about the timing and location of forthcoming talks with Iran remain undisclosed.

U.S. Crude Inventory Build

Additional market pressures came from a significant increase in U.S. crude inventories. The Energy Information Administration (EIA) reported an increase of 8.5 million barrels, bringing total inventories to 428.8 million barrels. This rise substantially surpassed the 793,000 barrels projected by analysts.

Moreover, U.S. refinery utilization rates decreased by 1.1 percentage points, falling to 89.4%, as reported by the EIA.

• Brent crude oil: $69.10 per barrel
• WTI crude oil: $64.40 per barrel
• Increase in U.S. crude inventories: 8.5 million barrels
• Total U.S. crude inventories: 428.8 million barrels
• Refinery utilization rate: 89.4%

The current landscape indicates that oil prices are influenced by a combination of market forecasts and geopolitical developments. Investors are keenly monitoring these factors as they assess the future trajectory of oil prices.