Oil holds gains for 2nd straight day

Oil prices saw a slight increase within their recent price range as a report indicating increased U.S. stockpiles offset geopolitical unrest in the Middle East, Bloomberg reported.

Brent crude climbed by 0.57 per cent, trading close to $79 per barrel after rising 1.6 per cent over the previous two sessions.

West Texas Intermediate (WTI) rose by 0.86 per cent, standing at $73.94 a barrel.

The U.S. national crude inventories increased by 674,000 barrels last week, including a rise at the Cushing, Oklahoma, hub, according to the industry-funded American Petroleum Institute, citing people familiar with the data. The official numbers however are still expected later on Wednesday.

With the Middle East disruption premium and growing transport costs mostly offset by a mixed macroeconomic outlook, crude is only marginally higher than it was at the beginning of the year.

Despite the lacklustre price movements, oil derivatives trading is thriving, as evidenced by the main futures contracts’ aggregate open interest reaching its highest level since March 2022.

“It continues to remain a narrow, range-driven market for crude,” Keshav Lohiya, founder of consultant Oilytics stated. “One of the biggest reasons behind the oil markets absorbing all these geopolitical risk premiums has been the silent supply growth from non-OPEC countries.”