(LONDON) Oil was stabilizing on Thursday after several sessions of decline caused by the gloomy outlook for the world economy which prompted the International Energy Agency (IEA) to revise its demand forecast downwards.
Posted at 6:47 a.m.
Around 6:30 a.m., the barrel of Brent from the North Sea for delivery in December gleaned 0.16% to 92.60 dollars, and that of West Texas Intermediate (WTI) for delivery in November 0.08% to 87.35 dollars.
“The continued deterioration of the economy and the prices increased by an OPEC + supply reduction plan are slowing global oil demand”, notes the IEA in its monthly report.
The Organization of the Petroleum Exporting Countries (OPEC) was just as pessimistic the day before, revising global demand downwards for 2022 and 2023.
“However, it must be remembered that if the production cuts by OPEC+ (OPEC and its allies including Russia, editor’s note) are applied, world reserves should still decline next year”, warn ING analysts.
The announcement of the voluntary production cut by OPEC+ initially pushed up the price of oil, which has been falling since the start of the week.
“Prices reflect the turbulent market conditions, between a negative macroeconomy (war in Ukraine, confinements in China, inflation and interest rates) and sectoral activity which benefits prices” with production cuts, comments Tamas Varga, analyst at PVM.
To get an idea of the state of the market in the short term, investors will watch Thursday for the publication of the weekly report from the US Energy Information Agency (EIA).
Analysts expect crude reserves to increase by 1 million barrels and gasoline reserves to decrease by 2 million barrels, according to the median of a consensus compiled by Bloomberg.