The price of crude oil fell on Thursday in light of
the second successive crude inventory build announced by the EIA, the US Energy
Information Administration, on Tuesday.
The EIA reported an inventory build of 2.4 million
barrels for the week ending January, 21. It is a significant build, compared
with the reported figure for the previous week - a modest 0.5 million barrels.
As of 16:30 GMT, the price of WTI and Brent stood at
$87.24 and $89.88 respectively. Earlier on, the latter even hit $91, only to
come down later.
The rise in crude oil price and that of natural gas
may be related to the ongoing conflict between Ukraine and Russia too. Russia
is a key player in the energy sector and analysts are watching President Putin’s
next move carefully in order to gauge the immediate impact on the markets.
The growth of the US crude inventories and the false
dawn about a breakthrough between the US and Russia relations may have
triggered off the fall in the crude oil prices, earlier on during the day.
On the other hand, the rising crude oil prices have
pushed up the US crude oil in the past the above graph explicitly shows the
trend – once more.
The rising prices have brought down the consumption
and the fact the repeated release of SPRs, Strategic Petroleum Reserves, either
individually or collectively, have not been an effective, irreversible impact
on the price.
That means, the politicians are under enormous
pressure to get a grip with the crisis. What the former can do remains to be
seen.
