Oil stocks on the Gulf Coast of the United States have risen to their most significant level in nearly ten years, with 20 million barrels added since the beginning of the month. More robust export demand from Asia has resulted in additional barrels being directed to Gulf Coast export hubs. According to Bloomberg, the accumulation is just transitory as refiners begin to rev up operations following seasonal maintenance.
One of the reasons for the significant fall in Oil stockpiles at Cushing, Oklahoma—the delivery point for West Texas Intermediate contracts—appears to be an increase in supplies diverted to the Gulf Coast for exports and local processing. Bloomberg reported in early October that Cushing inventories had been taken down by the most in a week in five years, plummeting to the lowest level since 2018.
Prices fell, however, after news that Iran and the EU were set to return to the negotiating table over the nuclear accord. This means more could be arriving on the market soon, albeit the negotiations’ success is far from straightforward for Oil dealers. Meanwhile, according to another analyst, markets will stay volatile until OPEC+ intervenes.