Brent crude futures rose yet again on Wednesday to reach a record-high of USD$80 per barrel, following an unexpected drop in US crude inventories and the continuing economic sanctions imposed by the Trump administration on Iran.
On Tuesday, it was reported in this site that the global price for crude increased an average of two percent after reports of a larger-than-expected dip on US crude reserves.
As previously detailed, Brent crude futures rose by 2.2 percent or USD$1.69, putting the price for each barrel at USD$79.06. But as of Wednesday, a new update from Reuters revealed that the figure has since moved upwards.
According to the news outlet, Benchmark Brent crude futures were up yet again and is now reaching USD$80.13 a barrel, merely cents away from the previous pricing but is already deemed the highest since May.
The US West Texas Intermediate (WTI), meanwhile, rose by USD$1.12 to settle at USD$70.37 per barrel. Yesterday's news saw WTI crude futures at USD$69.25 a barrel.
These up surging price trends are hardly surprising at all given the oil industry data provided over by the American Petroleum Institute (API) suggest that the US crude inventories have been suffering greatly as of late. The USOILC=ECI, according to Reuters, fell by 5.3 million barrels last week - a far cry from the initial projection of 805,000 barrel decrease.
Industry expert Jim Ritterbusch of Ritterbusch and Associates told the news outlet that this week's crude stock decline is far from what API's speculations suggest.
Other Major Factors Affecting Oil Price Hike
Aside from America's dwindling crude reserves, there are other reasons being pointed out with regards to the staggering oil price increase.
According to the Financial Times, Washington's re-imposition of sanction on Iran greatly affects the global oil trade. Come November 4, Tehran will be prohibited from trading their black gold to the world market.
Being one of the largest OPEC (Organization of Petroleum Exporting Countries) crude suppliers in the world, Iran's absence in the scene will definitely be felt.
Russia's energy minister, Alexander Novak, said on Wednesday, which was cited by the publication, that Trump's sanction on Iran's oil industry could result in huge uncertainties in the market.
With the ever-increasing demand for fuel around the world, there's something that should be done in order to offset the supply loss.
Saudi Arabia and Russia, in particular, have pledged to increase its production. However, statistical data have been telling otherwise, suggesting the falling domestic production rate.
