Oil Prices Gain Over 1% as Market Focuses on Demand Outlook

Oil prices advanced in midday trading Saturday, with both major benchmarks posting gains of over one percent. West Texas Intermediate (WTI) crude was up $0.89, or 1.15%, to trade at $78.18 per barrel. The international benchmark, Brent crude, rose $1.06, or 1.29%, to $83.55 per barrel. Natural gas saw a modest increase of $0.02 to $2.66 per MMBtu.

The price increase comes despite a reported build in U.S. commercial crude inventories, a typically bearish signal for the market. According to Rigzone, citing the latest U.S. Energy Information Administration (EIA) weekly petroleum status report, crude oil stocks, excluding the Strategic Petroleum Reserve, stood at 407.0 million barrels as of July 31, representing a week-on-week increase.

Market analysts suggest the price rise indicates traders are looking beyond the immediate inventory data, focusing instead on broader demand expectations and potential supply-side factors. The market appears to be balancing the inventory build against other supportive elements, such as geopolitical tensions or anticipated seasonal demand.

For Bakken operators, the midday price action provides a positive signal. The Bakken crude differential—the discount at which Bakken-grade crude trades against the WTI benchmark—was recorded at -$3.42. This stable differential, combined with the rising benchmark price, suggests improved netback prices for oil produced in the Williston Basin. At current levels, Bakken crude would be priced around $74.76 per barrel.

Price movements are a direct determinant of cash flow and drilling economics for North Dakota producers. Sustained prices above $75 per barrel for WTI generally support active drilling and completion programs in the region. The current price environment, if maintained, could bolster operator confidence for the remainder of the third quarter.

The natural gas price, while up slightly, remains depressed at $2.66, continuing a long-term trend that limits the economic contribution from associated gas production in the Bakken. Operators primarily focus on crude oil, with natural gas often seen as a byproduct.

Traders will continue to monitor global supply and demand signals, including OPEC+ production policy and economic indicators, for direction. The market's ability to absorb an inventory build and still move higher will be seen as a test of underlying strength.