In North America, crude oil demand remained low throughout the quarter due to the underwhelming outlook on economic activities, despite no significant disturbances in the supply chain. According to the data, WTI Crude Oil Prices declined from USD 79/barrel to USD 74/barrel within the first quarter of 2023. World oil supply improved by 830,000 barrels per day in February, primarily driven by improved demand from the US and Canada after winter storms and other disturbances. However, prices kept their downtrend as Asian players opted for Russian crude, which was available at cheaper rates.
During Q1 2023, Asian players started opting for Russian crude oil to gain profits, as it was available at cheaper rates. China's slow recovery remained a matter of concern for the global crude oil market, as it was lower than expected and did not allow the prices of crude oil to rise globally. Additionally, major Asian countries like India started importing crude oil from Russia, even after the ban and sanctions imposed by the West and the USA. Moreover, the global crude oil inventory level surged due to unexpectedly dull demand in the international market amidst the rise in inventory levels.
The global economic slowdown kept the European market at its low for the entire quarter as a repercussion of the Russia-Ukraine war. According to the data, the European market kept on suffering from high inflation and slow economic activities in the region. Despite the multiple sanctions and bans on Russia, including the price cap on Russian crude and natural gas, Russia managed to sail its cargo to the Asian market. Furthermore, the UK remained the most affected country by inflation and slow economic activities. However, some experts believe that Europe may not go into recession this year.
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