Brent oil dipped below US$75 per barrel this week, while West Texas Intermediate fell below US$68 per barrel on Wednesday.
For much of 2023, US crude stockpiles have been expanding and a flood of oil shipments overseas has kept other markets well supplied. Russia’s exports have remained stubbornly resilient, despite a pledge to reduce output, while strikes blocking refineries in France are hobbling demand. Part of the selloff has been one-sided oil market positioning. Money managers and other speculators had the most bullish bets relative to bearish ones in four years in the week to March 7.
Chinese refiners have been snapping up barrels from the Middle East and the US and ramped up processing at the start of the year after the country’s Covid Zero policy was ditched. Premiums for Dubai crude have surged over recent weeks, even as other parts of the world lag behind.