By Peter Nurse
Investing.com — Oil prices traded lower Thursday, extending the previous day’s losses after the United States said it was considering selling oil from its strategic reserves, potentially relieving a tightly supplied market.
By 9 AM ET (1300 GMT), U.S. crude futures were down 0.6% at $76.94 a barrel, while Brent futures were down 0.3% at $80.83 a barrel. Both contracts fell around 2% on Wednesday.
U.S. Gasoline RBOB Futures were down 0.1% at $2.3076 a gallon.
Weighing on the market Thursday were comments from U.S. Energy Secretary Jennifer Granholm, who said on Wednesday that the administration is considering tapping the country’s Strategic Petroleum Reserve to cool a surge in gasoline prices.
“The Energy Secretary also did not rule out the possibility of an export ban on crude oil,” said analysts at ING, in a note. “If an export ban was the route the U.S. decided to take, we would likely see a widening in the WTI-Brent spread.”
Adding to the negative tone Thursday was a larger-than-expected rise in U.S. crude inventories last week, with stocks rising by 2.3 million barrels, according to data from the U.S. Energy Information Administration said, against expectations for a modest dip.
Natural gas prices also retreated after Russian President Vladimir Putin indicated that his country was prepared to send gas supplies to Europe, in response to the all-time record highs.
“In Europe, the latest data shows that storage is around 76% full compared to a 5-year average of around 90% for this stage of the year,” added ING. “This should still edge higher in the coming weeks. We generally only start to see gas storage falling towards the end of October/early November.”
That said, the crude market remains only marginally below multi-year highs as demand returns with Covid-19 cases on the retreat globally and with the Organization of Petroleum Exporting Countries and allies, a group known as OPEC+, only restoring gradually the record amount of supply that it held from the market during the period of Covid-induced mobility restrictions.