Crude prices slightly increase after dropping below $100/bbl

Thursday saw a little uptick in the price of Brent crude after it dropped below the $100 per barrel threshold for the first time since April.

After the recent price decline, investors started buying deals, according to analysts. The ongoing worries of a global recession, however, restrained the price increase.

The American Petroleum Institute’s (API) mixed weekly report, which showed an unexpected increase in US crude oil supplies but also a reduction in product stocks, weighed on prices, according to Ravindra Rao, head of commodity research at Kotak Securities.

According to the API report, for the week ending June 30, US crude oil stockpiles rose by 3.8 million barrels, escalating concerns about demand. However, during the same time period, distillate inventories fell by 6,35,000 barrels and gasoline inventories fell by 1.8 million barrels.

“Also weighing on price are demand concerns amid recession talks and renewed virus concerns in China. Crude oil has been one of the best performing commodity this year due to supply risks and this has made it vulnerable to profit taking as market players moved out of riskier assets to the safety of US dollar. However, supply risks are still there, so whenever we see some stability across commodities, crude oil may bounce back sharply,” Rao said.

Crude oil prices are likely to stay weak and may approach $90 per barrel in the upcoming sessions, according to Rahul Kalantri, vice president for commodities at Mehta Equities.

Brent’s September contract on the Intercontinental Exchange was trading at $100.78 at 11:30 a.m., up $0.09 from the previous close. Similar to how the August of West Intermediate Texas on the NYMEX increased from its previous closing, it increased by 0.17 percent to $98.70 per barrel.