Mumbai, 15 May (Commoditiescontrol): In early trading on Wednesday, crude oil prices saw modest gains as escalating wildfires in Canada posed a threat to the country's major oil sands production and as market participants anticipated a reduction in U.S. crude oil and gasoline inventories.
Brent crude futures increased by 34 cents to $82.71 a barrel, marking a 0.4% rise. Similarly, U.S. West Texas Intermediate (WTI) crude futures climbed 38 cents, reaching $78.39 a barrel, a 0.5% increase.
The wildfires are nearing Fort McMurray, a critical center for Canada's oil sands industry, which produces approximately 3.3 million barrels per day. This figure represents two-thirds of Canada's total oil output. The looming threat has prompted evacuation orders for thousands of residents in nearby suburbs, raising concerns about potential disruptions to oil production.
Adding to the market dynamics, U.S. producer prices in April rose unexpectedly, fueling speculation about the economic outlook and interest rates. Despite these price pressures, Federal Reserve Chair Jerome Powell indicated that further rate hikes might be unlikely, although the prospect of rate cuts remains uncertain.
Investors are also keenly awaiting the release of U.S. consumer price data and the latest figures on crude oil and gasoline inventories. Preliminary reports from the American Petroleum Institute (API) suggest that U.S. crude inventories decreased by over 3 million barrels last week. Additionally, gasoline stocks fell by approximately 1.27 million barrels, while distillate stockpiles saw an increase.
These developments come at a time when the energy market is particularly sensitive to supply disruptions and economic indicators, making the upcoming inventory data a likely catalyst for future price movements in the oil market.
(By Commoditiescontrol Bureau: 09820130172)
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