Daily Times

Crude oil futures dipped up to 13 percent on a week-on-week (WoW) basis, with prices posting their largest one-week percentage loss in nearly two years and continuing their wild ride amid the Russia-Ukraine conflict.

Prices declined on the back of the largest-ever release from US crude reserves and news of a coordinated release by other International Energy Agency (IEA) members from emergency stockpiles.

Brent, the international benchmark for two-thirds of the world’s oil, edged lower by $16.26 (-13.48 percent) to $104.39 from $120.65 on a week-on-week (WoW) basis. The West Texas Intermediate (WTI), the main oil benchmark for North America, went down by $14.63 a barrel (-12.84 percent) to $99.27 from $113.90 on a weekly basis.

The price for Opec Basket slipped marginally from $118.72 to $107.74 on a week-on-week basis, showing a decrease of $10.98 (-9.25 percent). The OPEC Reference Basket of Crudes (ORB) is made up of Saharan Blend, Girassol, Djeno, Zafiro, Rabi Light, Iran Heavy, Basra Light, Kuwait Export, Es Sider, Bonny Light, Arab Light, Murban and Merey.

The price of Russian Sokol slipped by $11.47 (-10.98 percent) to $92.97 from $104.44 on WoW basis. Similarly, Arab Light prices witnessed a decrease of $14.28 (+12.15 percent) to reach $103.22 from $117.50 a barrel on a weekly basis.

The oil prices extended their loss from Thursday when US President Joe Biden authorised the release of 1 million barrels of oil per day for the next six months from the US Strategic Petroleum Reserve. The move could keep a lid on prices in the near term, analysts said, but they see it as only a temporary fix for tight global supplies, especially as the war in Ukraine grinds on.

Members of the International Energy Agency, which includes the US, most of Europe, Canada, Mexico, Japan and South Korea, said that they’ve also agreed to release oil from their emergency reserves, to join the US move. The IEA plans to release details on the release early next week.

The last week also saw an Opec+ meeting that rubber-stamped a previously agreed plan that will lift its production target by 432,000 barrels a day in May. The Opec+, which includes the Organisation of the Petroleum Exporting Countries and allies including Russia, continues to snub calls from the US and other western powers to raise output to quell the tight market conditions and remains disciplined in this high price environment.