22 Nov 2024

• WTI price gains momentum to near 70.25 in Friday’s Asian session. 
• The supply worries due to the escalation of the Russia-Ukraine war lift the WTI price. 
• US crude oil inventories built and a stronger USD might cap the WTI’s upside.
• West Texas Intermediate (WTI), the benchmark for U.S. crude oil, is currently trading at approximately $70.25 on Friday. The price of WTI has seen a slight increase due to escalating tensions in the Russia-Ukraine conflict, which has raised concerns regarding potential disruptions in crude oil supply.
  
  This week, the WTI price has been influenced by fears stemming from Ukraine's use of missiles, provided by the United States and the United Kingdom, that have targeted Russian territory. On Thursday, Russian President Vladimir Putin declared the initiation of a hypersonic medium-range ballistic missile strike on a Ukrainian military site. He also cautioned Western nations that Moscow could target any military installations in countries that employ weapons against Russia, according to Reuters. Ole Hvalbye, a commodities analyst at SEB, noted, "The market's focus has now shifted to heightened concerns about an escalation in the war in Ukraine."
  
  Conversely, an increase in U.S. crude inventories last week may exert downward pressure on oil prices. The Energy Information Administration's (EIA) weekly report indicated that crude oil stockpiles in the United States rose by 0.545 million barrels for the week ending November 15, following a larger increase of 2.089 million barrels the previous week. Market expectations had predicted a rise of 0.400 million barrels.
  
  Additionally, the renewed demand for the U.S. Dollar (USD) may limit the potential for further increases in USD-denominated oil prices, as a stronger dollar makes oil more expensive for buyers using other currencies, potentially dampening demand. The U.S. Dollar Index (DXY), which measures the value of the USD against a basket of six currencies, is currently trading near 107.05, having recently reached a year-to-date high of approximately 107.15.