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On Thursday, August WTI crude oil closed up $1.16 (+1.75%) at a backdrop of tighter global oil supplies, specifically following Iraq’s announcement of a loss of approximately 200,000 barrels per day (bpd) due to drone attacks on Kurdish oil fields. Additionally, the price surge was supported by positive signals from the U.S. economy, including a decrease in weekly initial unemployment claims to 221,000, lower than the predicted 233,000.
Despite this rally, the gains were moderated by a rise in the dollar index to a 3.5-week high and the prospect of Iraq resuming exports through the Iraq-Turkey pipeline, potentially adding 230,000 bpd back into the market. On the production side, OPEC+ has set plans to increase its output by 548,000 bpd starting August 1, aiming to restore a total of 2.2 million bpd by September 2026.
A recent report from the EIA indicated a decline in U.S. crude inventories by 3.859 million barrels for the week ending July 11, marking the first draw in three weeks, while U.S. crude production slightly fell to 13.375 million bpd.
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