The US crude oil market stabilized on Tuesday after an industry report showed a significant increase in US crude oil inventories, prompting a new round of attention to supply and demand balance in the market. Meanwhile, investors continue to pay attention to the potential impact of the Trump administration's trade policies.

The price of West Texas Intermediate (WTI) crude oil in the United States is hovering around $73 per barrel, with a cumulative increase of nearly 4% in the past three days. Brent crude oil prices closed around $77.

According to market research, as of last week, US crude oil inventories increased by 3 million barrels. If EIA data is confirmed on Wednesday, this will be the largest weekly increase in the past year.

The game between supply and demand

Since the beginning of 2024, oil prices have shown a fluctuating trend. The market initially saw an increase in heating demand due to the cold winter in the northern hemisphere, as well as US sanctions on the Russian oil industry driving up oil prices. However, the recent trade policies of the Trump administration have caused market concerns, leading to pressure on crude oil futures prices over the past three weeks.

There is a tug of war between market expectations of tight supply and global economic uncertainty, "said an industry analyst." Inventory increases may suppress oil prices in the short term, but trade policies and geopolitical factors remain key factors affecting future trends

At the same time, US sanctions on Russia are beginning to affect the flow of Russian crude oil. According to market data, millions of barrels of crude oil from the Pacific region of Russia have been delayed due to transport ships being blacklisted, forcing some major Asian refineries to adjust their procurement strategies. To attract buyers, Russia's crude oil prices have decreased.

API inventory rebounds, while finished oil inventory decreases

The API report also pointed out that API crude oil inventories increased by 400000 barrels last week, but gasoline and distillate inventories have decreased, indicating that refinery demand remains robust. However, due to fluctuations in refining profit margins, the market still needs to pay attention to the supply of refined oil products in the coming weeks.

Edit viewpoint

Recently, the market has become increasingly fierce in the game of supply and demand fundamentals. On the one hand, the unexpected significant increase in US crude oil inventories may mean that the market has ample short-term supply, putting downward pressure on oil prices.

On the other hand, the continuous changes in US trade policies have increased market uncertainty, and investors need to carefully evaluate potential global demand changes. In addition, the US sanctions on Russian oil have already affected the Asian market and may further alter the global energy flow pattern in the future. In this context, the volatility of oil prices may intensify in the short term, and it is important to pay attention to the direction of EIA inventory data after its release.