Oil Prices Rise Amid Inventory Draw, Major Middle East Pricing Shift

Oil prices moved higher on Friday, with West Texas Intermediate (WTI) crude gaining 0.85% to trade at $84.30 per barrel, according to midday price data. Brent crude rose 1.01% to $89.93. The Bakken crude differential to WTI was at a discount of $3.42 per barrel.

The price advance followed a U.S. government report showing a substantial weekly drawdown in commercial crude inventories. The U.S. Energy Information Administration reported that crude oil stocks, excluding the Strategic Petroleum Reserve, fell to 404.5 million barrels for the week ending July 24, a drop of more than 7 million barrels from the previous week.

A major structural shift in global crude pricing was also announced Friday, adding market uncertainty. The Abu Dhabi National Oil Company (ADNOC) said it will change the pricing formula for all four of its Abu Dhabi crude grades—Murban, Das, Umm Lulu, and Upper Zakum—effective November 1, 2026. According to reports from OilPrice.com, ADNOC will move from a system pricing cargoes two months ahead using ICE Futures Abu Dhabi Murban futures to a prompt-month pricing methodology based on the Platts Dubai benchmark.

The change marks one of the biggest adjustments to Middle East crude pricing in years and follows the United Arab Emirates' exit from OPEC and OPEC+ in May, which freed ADNOC from production quotas. The new system will price cargoes in the month they load, using the Platts Dubai assessment plus an ADNOC-announced differential. OilPrice.com reported that the move is intended to align crude pricing more closely with how Asian refiners manage product exposure, providing faster price discovery and more effective hedging during periods of market volatility.

For Bakken operators, the midday price of $84.30 WTI, net of the local differential, provides a solid economic signal for continued production. The significant draw in U.S. inventories suggests robust domestic demand or tightening supply, which supports the price floor. The long-term implications of ADNOC's pricing shift are less direct but contribute to a evolving global benchmark landscape. As a key light-sweet crude producer, Bakken output competes in a global market where pricing mechanisms for other major light grades, like Murban, are in flux.

Natural gas prices saw a slight decline, trading at $2.73 per MMBtu, down $0.03 on the day.