WTI tumbles to near $100.00 on surprise US inventory build despite supply disruption worries
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $100.00 during the early European trading hours on Wednesday. WTI falls after an unexpected build in US crude inventories.
WTI crude oil, a leading US benchmark, experienced a significant price drop to near $100.00 during early European trading on Wednesday. This decline occurred despite concerns over supply disruptions due to an unexpected increase in US crude inventories. According to the American Petroleum Institute (API), the country's crude oil stockpiles surged by 7.14 million barrels during the week ending September 11, marking a stark contrast to the previous week's decline of 300,000 barrels.
The market had anticipated a 1.8 million barrel drop. Saudi Arabia's suspension of oil loadings at its Yanbu port, following an attack by Yemen's Iran-aligned Houthis, also contributed to the price fall. This pipeline shutdown, which typically handles around 4 million barrels per day, or about 4% of global supply, was expected to be brief.
Analysts at Rabobank warned that the latest supply disruption was happening amidst a fragile market backdrop, with global crude inventories dwindling and strategic reserves nearing concerning levels. Despite this, technical analysis indicated a bullish near-term outlook for WTI, with the price holding above the 100-day simple moving average ($85.36) and the 20-day Bollinger middle band ($90.05).
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