Oil fluctuates with IEA to release more barrels from stockpiles

Oil swung near US$102 in another volatile session following reports that the International Energy Agency plans to deploy 60 million barrels of crude in addition to the huge stockpile release already announced by the Biden Administration.

Oil swung near US$102 in another volatile session following reports that the International Energy Agency plans to deploy 60 million barrels of crude in addition to the huge stockpile release already announced by the Biden Administration. 

West Texas Intermediate traded erratically after rising to as high as US$104 a barrel, swinging into negative territory after U.S. data showed domestic crude stockpiles rose last week. The government data followed news that the IEA will release 120 million barrels of oil -- half from the U.S. and half from other members. The U.S. and its allies are coordinating on a new round of sanctions to punish the Kremlin for the alleged war crimes by its troops in Ukraine. 

Oil prices have struggled to find direction in a market with lower liquidity as headlines send futures swinging in both directions. Data from the U.S. Energy Information Administration showed crude stockpiles rose by more than 2 million barrels last week, adding to bearish sentiment.

Prices surged by a third in the first quarter as the Russian invasion and backlash from the EU and U.S. roiled markets. While the U.K. and Washington have moved to bar Russian crude, it’s harder for the EU to follow suit given the region’s high level of dependence. 

In recent sessions, crude futures have come off the highs seen in early March with Washington and the IEA tapping strategic petroleum reserves to try to calm markets, while the coronavirus outbreak in China has also contributed to a pullback.