Brent approaching $80 after a record increase in US inventories

Oil prices stabilized on Thursday, with Brent trading close to $80 a barrel, despite concerns about disruptions in global trade and rising inventories in the United States.

As of 0914 GMT, Brent crude futures saw a modest increase of 13 cents, or 0.1 percent, reaching $79.80 per barrel, while US West Texas Intermediate crude rose by four cents to $74.26.

The US Energy Information Administration reported on Wednesday that US crude inventories rose by 2.9 million barrels in the week ending December 15, reaching 443.7 million barrels. This contrasted with analysts’ expectations of a decline of 2.3 million barrels according to a Reuters poll. Additionally, US crude oil production reached a record level of 13.3 million barrels per day, surpassing the previous peak of 13.2 million barrels per day.

Despite these factors, the two benchmarks rose in the previous session for the third consecutive time. Investors expressed concerns about trade disruptions as major shipping companies opted for longer sea routes, away from the Red Sea, leading to increased transportation and insurance costs.

Approximately 12 percent of global traffic passes through the Red Sea and the Suez Canal. Analysts, however, note that the impact on oil supplies has been limited so far, as the majority of Middle East crude is exported through the Strait of Hormuz.