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Oil Up, but Inflation Concerns Cap Gains

Published 11/11/2021, 04:44
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By Gina Lee

Investing.com – Oil was up Thursday morning in Asia. Meanwhile, rising inflation in the U.S. thanks to soaring energy costs, could prompt the release of more strategic crude stockpiles to drive down prices.

Brent oil futures were up 0.23% to $82.83 by 10:37 PM ET (3:37 AM GMT) and WTI futures were up 0.26% to $81.55.

Both Brent and WTI futures fell on Wednesday after Wednesday’s data showed that U.S. inflation increased at the fastest rate in 30 years. The consumer price index grew 6.2% year-on-year and 0.9% month-on-month, while the core CPI rose 4.6% year-on-year and 0.6% month-on-month in October.

U.S. President Joe Biden has requested that the National Economic Council find ways to reduce energy costs and the Federal Trade Commission to push back on market manipulation in the energy sector to reverse inflation. These efforts could include releasing more supplies from the U.S. Strategic Petroleum Reserve.

"The U.S. also increased pressure on oil markets, with President Biden asking his economic advisors to explore ways to lower energy prices," ANZ Bank analysts said in a note.

"There is growing speculation that the U.S. might coordinate releases of inventory with other nations, such as Japan."

Inventories of gasoline and distillates, such as diesel, continued to fall, the U.S. Energy Information Administration (EIA) said on Wednesday. Wednesday’s crude oil supply data from the EIA showed a build of 1.001 million barrels in the week to Nov. 5. Forecasts prepared by Investing.com had predicted a 2.125-million-barrel build, while a 3.291-million-barrel build was reported during the previous week.

Crude oil supply data from the American Petroleum Institute released the day before, showed a draw of 2.485 million barrels.

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