Oil Prices Edge Higher on Supply Risks, Falling U.S. Crude Stocks

Crude oil prices rose modestly early Thursday, supported by a larger-than-expected draw in U.S. inventories and continued supply concerns in the Middle East affecting global energy markets. West Texas Intermediate (WTI) crude traded at $79.96 per barrel, up 0.45% on the day, according to live price data.

The U.S. Energy Information Administration reported a nearly 2 million barrel weekly draw in commercial crude oil stocks, excluding the Strategic Petroleum Reserve. Inventories stood at 409.7 million barrels as of July 10, according to Rigzone. The drawdown provided fundamental support for prices.

In the Bakken, the price differential for North Dakota light sweet crude versus the WTI benchmark was steady at -$3.42 per barrel. This relatively narrow discount indicates strong demand for Bakken crude, which is competitively priced and efficiently transported to refining markets.

Global supply concerns were highlighted by a significant disruption in liquefied natural gas (LNG) flows. According to OilPrice.com, Pakistan was forced to pay approximately $20.70 per MMBtu for a spot LNG cargo this week, its highest price in four years. The purchase was necessitated by the re-escalation of the Hormuz crisis, which has cut off cargoes from its primary supplier, Qatar. This underscores how geopolitical tensions in the Middle East continue to inject volatility and tightness into global energy markets, indirectly supporting oil prices.

On the natural gas front, the U.S. benchmark Henry Hub spot price was unchanged at $2.92 per MMBtu in early trading. However, the market outlook is strengthening. Rigzone reported that the U.S. Energy Information Administration has raised its Henry Hub price forecast for both 2026 and 2027 in its latest Short-Term Energy Outlook, signaling expectations for firmer prices ahead.

For Bakken operators, the current price environment remains supportive. WTI holding near $80, combined with a stable differential, provides solid cash flow for ongoing production and well maintenance. The tightening global LNG market, driven by Middle East supply disruptions, reinforces the strategic value of U.S. energy exports, including associated gas from the Bakken. The EIA's upward revision for future natural gas prices also offers a more optimistic revenue outlook for gas production in the region.

The market continues to balance robust U.S. production against inventory draws and persistent geopolitical risks, keeping prices in a tight range just below the $80 threshold for WTI.