West Texas Intermediate (WTI) crude futures fell 1.2% to $81.45 per barrel on Thursday, retreating from a four-week high reached earlier this week despite ongoing supply concerns. The pullback comes as traders weigh conflicting signals from U.S. inventory data and geopolitical risks in key oil-producing regions.
Analysts attribute the price movement to a combination of factors. ‘The market is caught between bullish geopolitical risks and bearish inventory builds,’ said a senior energy strategist at a major investment bank who requested anonymity due to company policy. U.S. crude stockpiles rose by 3.2 million barrels last week according to EIA data, countering concerns about potential supply disruptions.
Geopolitical tensions remain elevated, with recent attacks on Russian refineries and ongoing Houthi strikes on Red Sea shipping lanes. However, some analysts suggest these risks may already be priced in. ‘We’re seeing classic profit-taking behavior after the recent rally,’ noted an energy markets reporter at Bloomberg. The commodity has gained nearly 15% year-to-date.
Looking ahead, traders will closely monitor OPEC+’s upcoming June meeting and U.S. economic data for clues about demand outlook. Some analysts warn that sustained prices above $80 could test the Biden administration’s tolerance for strategic petroleum reserve releases.