Oil Prices Plummet as US Inventories Rise Amid Saudi Pipeline Disruption
Oil prices fell sharply on Wednesday after an unexpected surge in US crude inventories, leading to concerns over supply risks. The Brent crude futures price dropped by 93 cents, or 0.86%, to $107.82 a barrel, while the US West Texas Intermediate (WTI) crude futures price declined by 97 cents, or 0.92%, to $104.86 a barrel.
The increase in US inventories was unexpected, with analysts predicting a decline of about 1.6 million barrels. Instead, the American Petroleum Institute reported that US crude oil, gasoline, and distillate inventories rose last week by 7.1 million barrels. This has led to a reevaluation of supply risks, particularly after Saudi Arabia suspended oil loading operations at Yanbu port due to an attack on its East-West pipeline.
The suspension of the pipeline, which accounts for nearly 4% of global oil supplies, has caused concern among investors. However, the US Department of Energy stated that crude oil flows through the vital pipeline are expected to resume within days.