(Bloomberg) — Oil held the largest decline in three months after US nationwide crude stockpiles hit the highest level since June.
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West Texas Intermediate traded below $83 a barrel after declining by more than 3% on Wednesday, while global benchmark Brent was above $87. US crude inventories rose by 2.7 million barrels last week, while gauges of fuel demand declined. The weak US data overshadowed the impact of geopolitical tensions in the Middle East as traders await Israel’s response to Iran’s recent attack.
In addition, US sanctions are in focus. President Joe Biden’s administration has reimposed restrictions on Venezuelan oil, ending a six-month reprieve in a move that may hamper flows from the South American nation.
Oil remains higher year to date as geopolitical risks in Russia and the Middle East, as well as supply cuts from OPEC+, aided prices. At present, there’s a premium of between $5 and $10 a barrel baked in, but without fresh escalation, prices may fall, Goldman Sachs Group Inc.’s head of oil research Daan Struyven said on Bloomberg Television.
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