Oil prices were lower during Thursday’s Asian trading session after reports out of the United States on Wednesday showed that U.S. crude inventories hit their highest level since December 2017. According to data from the Energy Information Administration (EIA), U.S. commercial crude inventories gained 4.9 million barrels last week to 446.91 million barrels. The country is now producing 11.7 million barrels per day, a record high.
OPEC and Russian leaders have said that they may consider production cuts to prevent prices from falling further. A decision is expected to be publicized at the next OPEC meeting. As of 2:25 p.m. HK/SIN, U.S. WTI futures were down 01.3 percent to $54.56 per barrel and Brent crude futures were down 0.27 percent to $63.31 per barrel. Just last month U.S. WTI peaked at $79.90 per barrel, and it has fallen over 30 percent since then, with a steep 6 percent decline on Tuesday alone.
Though OPEC has publicly expressed concern about declining oil prices, U.S. President Donald Trump has praised the move lower and has called for even further declines.
In a recent Tweet, Trump wrote: “Oil prices getting lower. Great! Like a big Tax Cut for America and the World. Enjoy!... Thank you to Saudi Arabia, but let’s go lower!”
Despite Trump’s happiness about the lower oil prices, analysts don’t expect prices to say this low. The seasonal cold will increase demand, analysts expect, and a production cut from OPEC and Russia can keep prices from falling – and may even send them back to recent highs. Still, analysts warn, if the U.S. continues to increase production, oil prices may have a harder time rising than anticipated.