WTI price remains above $71.00 as Saudi Aramco raises march oil prices for Asia
- WTI price received support as Saudi Aramco raised prices for Asian buyers amid rising demand, along with supply disruptions.
- EIA Crude Oil Stocks Change showed an 8.664 million-barrel increase for the previous week, against an expected 2.6 million-barrel increase.
- China’s tariffs on American crude oil have raised concerns over weakened global demand.
West Texas Intermediate (WTI) Oil price holds modest gains after three consecutive days of losses, trading around $71.10 per barrel during European trading hours on Thursday. This rebound in crude Oil prices comes after Saudi Arabia’s state Oil giant, Aramco, raised prices for Asian buyers.
Aramco’s price hike was driven by rising demand from China and India, along with disruptions to Russian supply due to US sanctions. Further supply risks persist as US President Donald Trump’s renewed push to eliminate Iran’s Oil exports could remove up to 1.5 million barrels per day from the market.
On Wednesday, Oil prices dropped more than 2% as a sharp increase in US crude and gasoline stockpiles signaled weaker demand. US crude inventories surged by 8.664 million barrels for the week ending January 31, 2025, the largest build in nearly a year, far exceeding market expectations of a 2.6 million-barrel increase. Meanwhile, distillate stockpiles, which include diesel and heating Oil, declined by 5.471 million barrels, compared to an expected draw of 1.5 million barrels.
Adding to market pressure, ongoing US-China trade tensions intensified as China imposed tariffs on American coal, LNG, and crude Oil, fueling concerns over weakened global demand. Additionally, these retaliatory measures could lead to a decline in US Oil exports in 2025 for the first time since the COVID-19 pandemic, following a plateau in growth last year.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
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