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Oil Markets Not Helping Inflation

Crude stockpiles in the largest U.S. storage hub dropped to their lowest level since July 2022, leading oil prices to jump to their highest level in a year.

By Julia Fanzeres | September 27, 2023 at 12:38 PM
Photo: Fuel storage tanks at a PT Pertamina depot at Pelumpang in Jakarta, Indonesia, on June 5, 2023. Photographer: Dimas Ardian/Bloomberg Fuel storage tanks at a PT Pertamina depot at Pelumpang in Jakarta, Indonesia, on June 5, 2023. Photographer: Dimas Ardian/Bloomberg

Oil prices jumped to a fresh one-year high as crude stockpiles in the largest U.S. storage hub dropped to the lowest level since July 2022.

West Texas Intermediate (WTI) settled above $93 a barrel after inventories at Cushing, Oklahoma, dropped just below 22 million barrels, close to operational minimums. The premium for near-term barrels of U.S. benchmark West Texas Intermediate is trading at more than $2, the highest since July 2022, as the futures market reflects the physical tightness.

While oil’s rally has rekindled talk of $100 crude, the gains had slowed over the past week. Key consumer India has noted the negative effects of higher prices on its economy, which raises some questions about demand next year.

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