Black commodity trade continued to decline further after consumer countries announced large production of crude oil from emergency reserves to ease upward price pressures caused by the Ukrainian and Russian crises.
According to the group’s director on Wednesday, the International Energy Agency (IEA) has agreed to release as many as 120 million barrels from storage, including 60 million barrels from the United States.
This is the second time the IEA has withdrawn supplies from its reserves this year and has effectively increased supplies worldwide by around 2 million barrels a day for at least the next two months as a way to offset Russia’s oil shortage. The group collectively has about 1.5 billion barrels in strategic reserves.
The announcement pushed crude oil prices to a three -week low, bringing Brent oil trading below $ 100 a barrel and US WTI falling below $ 97 a barrel towards the end of the New York session following a fall of more than 5%.
However, prices stabilized today with Brent oil futures rising slightly at around $ 103 a barrel and US WTI at $ 98 a barrel.
Crude oil prices have displayed volatile volatility this week following the prospect of more sanctions imposed on Russia and concerns of a lack of demand from China continuing a shutdown move in Shanghai to curb the spread of Covid-19 as well as being affected by the strengthening US dollar.