Oil rises, supported by a possible OPEC + supply cut

Oil prices rose on Thursday on mounting concerns over supply shortages amid disruptions to Russian exports, possible production cuts by major oil producers and the partial shutdown of a refinery in the United States.

By 0630 GMT, Brent crude rose 45 cents, or 0.4 percent, to $101.67 a barrel, while West Texas Intermediate crude rose 32 cents, or 0.3 percent, to $95.21 a barrel.

Both crude touched three-week highs on Wednesday after Saudi Arabia’s energy minister signaled the possibility of the OPEC+ cartel, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies, cutting production to support prices.

Discussions about the Iran nuclear deal are also still stalled, raising doubts about the resumption of Iranian oil exports.

In the United States, the world’s largest oil consumer, BP announced the closure of some units of its Whiting refinery in Indiana after a fire caused by a short circuit on Wednesday. The refinery, which operates with a capacity of 430,000 barrels per day, is a major supplier of fuel to the central United States and the city of Chicago.

Declining inventories of US crude oil and petroleum products added to upward pressure on prices. Oil inventories fell by 3.3 million barrels in the week ending August 19 to 421.7 million barrels, more than analysts’ average forecast in a Reuters poll for a drop of 933,000 barrels.

And US gasoline stocks fell 27,000 barrels to 215.6 million barrels, compared to previous expectations for a decline of 1.5 million barrels.

Talks between the European Union, the United States and Iran to revive the nuclear deal are still ongoing, and Tehran says it has received a response from Washington to the “final” text drafted by the union to revive the nuclear deal.

OPEC sources told Reuters that the OPEC + production cut will likely coincide with the return of Iranian oil to the market if Tehran concludes a nuclear deal with world powers.