Crude Oil Prices Hold Steady Amid Rising U.S. Inventory

Oil prices remained stable on February 20, 2025, despite a significant increase in U.S. crude stockpiles. Brent crude futures saw a slight rise, while West Texas Intermediate (WTI) also experienced modest gains. Analysts attribute the stability to a mix of supply disruptions and global demand concerns.

Key Takeaways

• Brent crude futures increased by 37 cents to $76.41 per barrel.
• West Texas Intermediate rose by 23 cents to $72.48 per barrel.
• U.S. crude stocks rose by 3.34 million barrels last week, according to the American Petroleum Institute.
• Supply disruptions in Kazakhstan and potential increases in Iraqi oil flows are influencing market dynamics.

Current Market Overview

Oil prices edged lower on Thursday following a report indicating a buildup in U.S. crude inventories. The American Petroleum Institute reported an increase of 3.34 million barrels in U.S. crude stocks, which has put downward pressure on prices. Despite this, Brent futures managed to rise to $76.41 per barrel, while WTI reached $72.48.

Factors Influencing Prices

Several factors are contributing to the current state of the oil market:

1. U.S. Inventory Build: The increase in U.S. crude stockpiles has raised concerns about oversupply in the market.
2. Supply Disruptions: Ongoing supply disruptions in Kazakhstan, particularly due to a recent drone attack on a pumping station, have reduced oil flows by 30%-40%. This could equate to a loss of approximately 380,000 barrels per day.
3. Potential Iraqi Oil Resumption: Analysts are closely monitoring the situation in Iraq's Kurdistan region, where a resumption of oil flows could add 300,000 barrels per day to the market.
4. Global Demand Concerns: Worries about demand from major economies, particularly Europe and China, are keeping prices in check.

Analyst Insights

Saxo Bank analyst Ole Hansen noted that the market is currently lacking a clear direction. The combination of supply disruptions and the potential for increased production from OPEC+ members is creating uncertainty. Additionally, the geopolitical landscape, including tariffs imposed by the U.S. administration, is raising concerns about the global economic outlook and its impact on oil demand.

Conclusion

As the oil market navigates through a complex web of supply and demand factors, prices have shown resilience despite the recent inventory build. Traders and analysts will be watching closely for further developments, particularly regarding U.S. inventory data and geopolitical events that could influence market dynamics in the coming weeks.

Sources

• Oil little changed after US crude inventory build | Kitco News, KITCO.