“Oil quotes fall due to rising fuel inventories in the US – ReutersBrent and WTI oil prices fell amid rising crude oil and gasoline inventories in the US, which exacerbates the risks of oversupply.
Weak demand and a slowing US economy are putting pressure on oil markets, despite geopolitical risks.
”, — write: unn.ua
This is reported by Reuters, writes UNN.
DetailsOn Thursday morning, Brent futures fell by 0.21% to $67.35 per barrel, while American WTI fell by 0.24% to $63.53 per barrel. This happened against the backdrop of a sharp increase in prices by more than a dollar the day before, reacting to reports of an Israeli attack on Hamas leadership in Qatar and the entry of Russian drones into Polish airspace during a massive attack on Ukraine.
Despite tensions in the Middle East and the continuation of Russia’s war against Ukraine, the markets reacted cautiously, as none of these events created a direct threat to energy supply disruptions. The focus remained on fundamental factors – the ratio of supply and demand.
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According to the US Energy Information Administration, last week commercial crude oil inventories increased by 3.9 million barrels instead of the expected decrease of 1 million. There was also an unexpected increase in gasoline inventories by 1.5 million barrels, although the market predicted a reduction. These trends, along with falling producer prices and signals of a slowdown in the American labor market, form expectations of a weakening US economy.
Thus, although geopolitical risks temporarily support quotes, weak demand and accumulation of fuel reserves are becoming key factors of pressure on oil markets.
Weakening labor market conditions mean that the FOMC (Federal Open Market Committee) will vote for a 25 basis point cut next week… although a rare triple dissent in favor of a 50 basis point cut could make headlines
RecallIt was reported earlier that oil prices rose after OPEC+’s decision on a less significant increase in production and rumors of new sanctions against Russia. Brent and WTI rose to $66.37 and $62.58 per barrel, respectively.
However, a few days ago, Brent and WTI oil futures fell amid expectations of increased OPEC+ production and growing US crude oil inventories. This led to weekly losses for the first time in three weeks.