WTI crude rallies over 2% on declining US inventories

The American WTI crude oil pushed higher on Thursday after OPEC+ had agreed to increase its monthly oil quotas, meanwhile, US inventories declined by 5.1-million barrels last week, above the 1.3-million-barrel fall.

West Texas Intermediate crude trades at $117.53, namely it is 2.37% higher on Thursday as US oil inventories fell more than expected last week. Traders were also taking into account that OPEC+ agreed to increase its monthly oil quotas that most of its members cannot meet.

OPEC+ on Thursday said it is raising quotas in July and August by 648,000 barrels per day, up from the 432,000 bpd in previous monthly hikes, to make up for lower Russian supply.

While negotiations between Saudi Arabia and the Biden Administration would ultimately determine this course of action, it would represent a swift change in the geopolitical landscape in the Middle East, placing Riyadh at odds with Moscow. Ultimately, this is unlikely to occur in the immediate term, which suggests these rumours will prove to be a distraction from the EU’s proposed insurance ban on shipping Russian oil to third countries.

Oil bulls moved in again when the Energy Information Administration reported US oil inventories fell by 5.1-million barrels last week, well above the 1.3-million-barrel fall markets are positioning for ahead of the announcement. Meanwhile, analysts at TD Securities explained that the ”rumours that OPEC members are considering to exempt Russia from their production deal.