Oil falls again as demand expectations decline and inventories rise
Oil prices fell today, Thursday, as demand concerns overcame the OPEC+ alliance’s plans to maintain production cuts, which means continued supply shortages, at a time when US crude oil inventories showed a rise for the first time in nearly two months.
Brent crude futures fell 68 cents, or 0.8%, to $85.19 by 15:07 GMT, while US West Texas Intermediate crude fell 67 cents, or 0.8%, to $83.55. Both benchmarks fell by more than a dollar to their lowest levels during the session.
Oil prices fell more than five dollars at settlement yesterday, Wednesday, the largest daily decline in more than a year, amid focus on a darker macroeconomic outlook and declining demand for fuel.
Prices fell sharply yesterday, following the meeting of the Joint Ministerial Monitoring Committee of the OPEC+ alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and other allies led by Russia.
The committee did not approve any changes to the coalition’s oil production policy, and Saudi Arabia said it would continue a voluntary reduction of one million barrels per day until the end of 2023, while Russia would maintain a voluntary reduction in exports of 300,000 barrels per day until the end of December.
The Kremlin also said there was no deadline for lifting the ban on fuel exports to combat domestic gasoline and diesel prices.
“We still expect the market to experience shortages in the fourth quarter, and lower prices reduce the likelihood of OPEC easing supply restrictions,” National Australia Bank analysts said in a note.
Data yesterday, Wednesday, also showed a sharp decline in demand for gasoline in the United States. Yesterday, other data showed a slowdown in the US services sector, while a survey reported that the euro zone economy is likely to contract in the last quarter of the year.
Crude inventories in the United States fell by 2.2 million barrels to 414.1 million barrels during the previous week ending September 29, but crude oil inventories at the delivery center in Cushing, Oklahoma, rose for the first time in eight weeks, which clearly contributed to the decline in oil prices over the past week. On Wednesdays and Thursdays.
(Reuters, Al-Arabi Al-Jadeed)
2023-10-05 17:05:30
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