Oil Prices Edge Lower Amid Rising U.S. Crude Stockpiles and Trade Policy Uncertainty

Oil prices dipped after an industry report indicated the first rise in U.S. crude stockpiles since mid-November. According to the American Petroleum Institute (API), U.S. crude inventories rose by 1 million barrels last week, while fuel stockpiles also surged. The report has raised anticipation for official government figures, which are expected later on Thursday.

Price Movements: WTI and Brent

West Texas Intermediate (WTI) crude extended its losing streak, slipping toward $75 per barrel, a trend that began last Thursday. Meanwhile, Brent crude settled at $79 per barrel, reflecting continued pressure on global oil benchmarks.

Seasonal Trends and Market Context

Typically, U.S. crude stockpiles decline toward the end of the calendar year due to tax-related reasons. However, this year’s inventory build comes amid heightened volatility in the oil markets, driven by global trade uncertainties and geopolitical tensions.

Despite recent losses, oil prices remain higher for the year, bolstered by a strong start due to sinking temperatures across the Northern Hemisphere, which drove up heating demand. Additionally, U.S. sanctions on Russia’s oil sector have disrupted global supply chains, contributing to the market’s complexity.

India’s Role in Russian Oil Trade

India has played a pivotal role in sustaining the flow of discounted Russian crude. The country has expanded its support for Russian insurers to ensure uninterrupted imports, further cementing its position as a key buyer amid the sanctions on Moscow.

Trade and Geopolitical Uncertainty

The market is also closely watching developments from the new Trump administration. Recent tariff threats targeting China, Canada, and Mexico have fueled uncertainty, alongside warnings of additional penalties on Russia if President Vladimir Putin does not make progress toward ending the war in Ukraine.

Conclusion

Oil markets remain under pressure as traders weigh rising U.S. inventories, geopolitical risks, and potential trade actions. The combination of seasonal factors, sanctions, and policy shifts continues to create a volatile landscape for crude prices.

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