Oil prices held firm near their highest levels in two months, driven by indications of a major reduction in US crude inventories. Brent crude traded above $86 per barrel after a slight 0.4% decline on Tuesday, while West Texas Intermediate remained around $83. According to insiders, the American Petroleum Institute reported a substantial 9.2 million barrel decrease in crude stockpiles last week. If confirmed by official data on Wednesday, this would represent the largest drop since January.
This year, oil prices have been supported by a positive trend in equity markets, with the US S&P 500 index repeatedly reaching new highs. Additionally, concerns about an active hurricane season have contributed to the upward pressure on prices. In the options market, bullish sentiment is evident as call options are trading at a rare premium over puts.
Geopolitical factors are also influencing the market. Investors are closely watching the upcoming elections in France and the UK. Meanwhile, in the Middle East, escalating tensions between Israel and Hezbollah pose a risk of broader conflict. The Israel Defence Forces have issued warnings for Palestinians to evacuate parts of Gaza’s Khan Younis ahead of a potential new offensive.
