Oil trending upwards

Oil edged higher after a mixed U.S. inventories, including an unexpected drop in crude inventories nationwide. Brent crude rose to $84 a barrel after rising 0.5 percent in the previous session, and U.S. crude rose above $79. Overall crude inventories fell by 1.36 million barrels last week, but inventories at the Cushing storage hub reached their highest level since July. Oil has been falling since early last month as tensions in the Middle East eased. Analysts including Daan Struyven said in a note that Goldman Sachs no longer expects the group to announce a partial easing of voluntary output cuts in June. “We expect OPEC+ supply to be lower for longer,” they said. Still, higher output targets remain “reasonable” as increased spare capacity could increase pressure to boost output. Separately, the Biden administration raised the price it is willing to pay to replenish the country’s emergency oil reserves. The Energy Ministry will pay up to $79.99 per barrel, setting a clear ceiling for the first time. “Oil prices are trying to stabilize after declining in the last two weeks. The deadlock between Israel and Hamas in the Middle East and the decline in U.S. crude stocks provide reasons for some easing of the downtrend,” said Yeap Jun Rong, market strategist at IG Asia.