Oil prices drop on Thursday July 22, 2021, post an unforeseen increase in U.S. crude Oil inventories as increasing COVID-19 infections pressure demand, but Oil rates held on to most of their adds from the earlier session on anticipations that supplies will stay stretched by the end of the year.
Brent crude dropped by 0.4% or 32 cents to settle at USD71.91 per barrel post increasing 4.2% in the earlier session. U.S. West Texas Intermediate (WTI) crude dropped by 0.4% or 27 cents, to settle USD70.03 per barrel post increasing 4.6% on Wednesday July 21, 2021.Senior analyst, Edward Moya said that the fluctuations in energy stay high while traders wrestle with short-term demand fall from the worries related to the spread of Delta variant of COVID-19 and expectations the crude shortfalls will stay the same till the year end.
He also said that Oil will fight to get back all of its losses till the tendency of new restrictions or curbs begin to lift across the Europe, Australia and Southeast Asia.The data released by U.S. Energy Information Administration showed that Crude inventories in the US, which is considered being world’s top Oil consumer, elevated unpredictably to 439.7 million barrels from 2.1 million barrels, which is the highest since May.
Analysts had anticipated a fall of 4.5 million-barrel.Yet, distillate and gasoline inventories stationed draws of1.3 million barrels and 121,000 barrels showing superior demand because of summer driving season.Oil prices dropped in the start of this week followed by the agreement by OPEC+ to increase supply by 400,000 barrels per day starting from August by the end of the year.