Oil prices continue to rise and hit a 13-month high

Oil prices rose another 3.3% from the start of the week and hit a 13-month high on data about declining US inventories.

December Brent crude futures on the ICE Futures exchange rose 3.3% to $95 a barrel (+2.9% for the week, +13.8% for the month) since Monday, supporting vegetable oil prices. Oil prices continued to rise after the EIA's weekly report on Wednesday showed that U.S. crude inventories fell to a nine-month low and crude inventories at the main Cushing storage facility, a delivery point for WTI futures, fell to a 14-month low.

Prices rose last week following Russia's decision to ban gasoline and diesel exports in an attempt to stabilize domestic fuel prices, which Vortexa said would reduce global fuel supplies by 1 million barrels per day, or about 3.4% of of total world demand and will worsen the already tense situation on the world energy market.

On the other hand, the dollar (DXY00) rose to a 9-month high and the S&P 500 fell to a 4-month low, limiting further oil price growth, undermining confidence in the US economic outlook and a possible reduction in energy demand if the economy will continue to slow.

Vortexa's weekly report showed that crude oil inventories on tankers parked for more than a week rose 11% for the week to 95.9 million barrels as of September 22.

Further improvement in relations between the US and Iran (after the exchange of prisoners and the release of $6 billion) could lead to a possible resumption of negotiations on the nuclear program and the lifting of sanctions against Iran and increased exports of Iranian oil. According to TankerTrackers.com, Iran's oil exports rose to a five-year high of 2.2 million barrels per day in the first 20 days of August, with most of the oil going to China.

Surprisingly, against the backdrop of rising oil prices, the number of active oil wells in the US fell by -8 for the week to a 19-and-a-half-month low of 507 wells. This is well below the high of 627 wells recorded on December 2, 2022.

December palm oil futures on the Malaysian exchange also jumped 2.2% yesterday to RM3,773 a tonne or $802 a tonne (unchanged in two weeks), supported by higher oil prices.