Crude Prices Jump on Possible US-India Trade Deal and Lower EIA Inventories

Core Insights - Crude oil and gasoline prices experienced a significant rally, reaching one-week highs, driven by reports of a potential US-India trade deal that may reduce India's imports of Russian crude, thereby increasing demand from alternative suppliers [2] - The unexpected decline in weekly EIA crude inventories further supported the rise in crude prices [2] - The Trump administration's announcement to refill the Strategic Petroleum Reserve by 1 million barrels in December and January provided additional support for crude prices [3] Group 1: Market Dynamics - Cooling tensions in the Middle East have reduced the risk premium in crude prices, as the likelihood of supply disruptions has decreased following a ceasefire agreement between Israel and Hamas [4] - A reported 12% week-over-week decrease in crude oil stored on stationary tankers indicates a bullish trend for oil prices, with current storage at 78.44 million barrels [4] - OPEC+ agreed to a smaller-than-expected increase in crude production targets, raising them by 137,000 barrels per day starting in November, which is less than the anticipated 500,000 barrels per day [5] Group 2: Supply Factors - Reduced crude exports from Russia, due to targeted attacks on refineries and export terminals, have limited Russia's export capabilities, with total seaborne fuel shipments dropping to 1.88 million barrels per day in early October, the lowest in over 3.25 years [6] - The International Energy Agency (IEA) has forecasted a record global oil surplus of 4.0 million barrels per day for 2026, indicating potential bearish pressures on crude prices in the long term [3]