Oil dips on profit taking

News Desk
Thursday, Mar 30, 2023

HOUSTON: Oil ticked down on Wednesday in choppy trading as investors looked to pocket profits from two straight days of gains, and as markets debated supply tightness.

Brent crude eased 32 cents, or 0.4 percent, to $78.33 a barrel at 12:39 p.m. ET (1639 GMT), while West Texas Intermediate U.S. crude fell 11 cents, or 0.1 percent, to $73.09.

"The markets are trying to find equilibrium," said Dennis Kissler, senior vice president of trading at BOK Financial, noting heavy fund buying over the last two days.

On the supply side, worries of tight supply after an unexpected draw in US oil stocks and a halt to some Iraqi Kurdistan oil exports were partially offset by a smaller-than-expected output cut in Russia.

U.S. crude oil stockpiles fell unexpectedly last week, the Energy Information Administration said, as refineries ramped up operations after maintenance season and U.S. imports fell.

EIA data also showed a larger-than-expected draw in gasoline stocks, implying strong demand heading into the summer season.

News of the surprise drop in inventories came on top of a 450,000 barrels per day (bpd) of crude export halt on Saturday from Iraq's semi-autonomous northern Kurdistan region following an arbitration decision.

Norwegian oil firm DNO said it had begun shutting down production at its fields in Kurdistan. The company's Tawke and Peshkabir fields averaged output of 107,000 bpd in 2022, a quarter of total Kurdish exports.