MOSCOW (MRC) -- Oil prices rose more than 4% Wednesday, extending gains from the previous session as improved risk appetite provided support despite data showing an unexpected rise in US oil inventories, reported Reuters.
Brent crude futures rose USD2.88, or 4.2%, to settle at USD72.23 a barrel. U. West Texas Intermediate (WTI) crude futures rose USD3.1, or 4.6%, to settle at USD70.30 a barrel.
Futures are rebounding after dropping around 7% on Monday, following a deal by the Organization of Petroleum Exporting Countries and allies, together known as OPEC+, to boost supply by 400,000 barrels per day from August through December.
The sell-off was exacerbated by fears that a rise in cases of the Delta variant of the coronavirus in major markets like the United States, Britain and Japan would affect demand.
“Overall the OPEC agreement has crystallized what the market should expect as to the restoration of production,” said Andy Lipow, president of Lipow Oil Associates. “However, even according to OPEC+ numbers, it’s not enough to stem the overall world oil inventory decline, and to me, that is giving support to the market.”
The price gains on Wednesday come despite a rise in US crude stockpiles for the first time since May. Crude inventories rose unexpectedly by 2.1 million barrels last week to 439.7 million barrels, US Energy Information Administration data showed. Analysts had expected a 4.5 million-barrel drop.
As MRC informed earlier, Saudi Arabia, the world's top crude oil exporter, will supply full contractual volumes of August-loading crude to at least five Asian customers. However, Saudi Aramco has turned down two of the buyers' requests for extra barrels.
We remind that Mukesh Ambani, chairman and managing director of Reliance Industries Ltd (RIL), said in June he expects the company's deal with Saudi Aramco to materialise this year. Meanwhile, Yasir Al-Rumayyan, chairman of Saudi Aramco and the Governor of the Public Investment Fund, joined the board of Reliance as an independent director.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 953,400 tonnes in the first five months of 2021, which virtually corresponded to the same figure a year earlier. High denisty polyethylene (HDPE) shipments decreased. At the same time, PP shipments to the Russian market were 607,8900 tonnes in January-May 2021, up by 33% year on year. Shipments of homopolymer PP and PP block copolymers increased, whereas deliveries of PP random copolymers decreased.
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