Last Update: April 27, 2023, 01:23 AM IST
Brent crude closed at $77.69 per barrel, down $3.08, or 3.8 per cent. US West Texas Intermediate crude was down $2.77, or 3.6 per cent, at $74.30 a barrel. (Image: Reuters file)
Oil prices fell over 2 per cent on Tuesday on concerns of a slowing economy and expectations of further interest rate hikes
Oil prices fell nearly 4 percent on Wednesday, extending the previous session’s sharp losses, even as US crude inventories fell more than expected after a report raised fears of a recession for the world’s largest economy. Went.
Brent crude closed at $77.69 per barrel, down $3.08, or 3.8 per cent. US West Texas Intermediate crude was down $2.77, or 3.6 per cent, at $74.30 a barrel.
U.S. crude inventories fell 5.1 million barrels to 460.9 million barrels last week, Energy Information Administration (EIA) data showed, helping to limit the fall in prices, which was below analysts’ expectations for a 1.5 million drop in a Reuters poll. more than predicted.
The EIA said gasoline and distillate stocks also fell, falling 2.4 million barrels to 221.1 million barrels and nearly 600,000 barrels to 111.5 million barrels.
“The complex seems to focus more on a recession that may well play out rather than on some of the current EIA data,” said Jim Ritterbush of consultancy Ritterbush & Associates.
Forecasts of higher refinery activity, but lower crude exports, will continue to push and pull for weeks.
“Refinery runs are set to climb in the weeks ahead, boosting the demand side of the ledger, but to counter this, lower crude exports are expected, as the tightening of Brent-WTI spread curbs buying appetite.” falls,” said Matt Smith, lead US oil analyst at Kepler.
The Organization of the Petroleum Exporting Countries (OPEC) and producing allies such as Russia, collectively known as OPEC+, have raised oil prices to all their levels since announcing additional production cuts through the end of the year in early April. The benefits have been erased.
Russian Deputy Prime Minister Alexander Novak said on Wednesday that OPEC+ remains an efficient tool for coordination.
Oil prices fell more than 2 percent on Tuesday as economic concerns and expectations that further interest rate hikes could weigh on fuel demand growth were signs of a recovery in short-term consumption gains.
US consumer confidence fell to a nine-month low in April as concerns mounted that the economy is at risk of falling into recession this year. New orders for key US-made capital goods also fell more than expected in March and shipments declined.
“It (the data) will add credence to claims that the US economy is heading into recession,” said Stephen Brennock of PVM Oil.
Investors are also concerned that a possible interest rate hike by central banks fighting inflation could slow economic growth and reduce energy demand in the United States, Britain and the European Union.
The US Federal Reserve, the Bank of England and the European Central Bank are all expected to raise rates at their upcoming meetings. The Fed meets on May 2-3.
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(This story has not been edited by News18 staff and is published from a syndicated news agency feed)
