American oil rigs
Oil prices fell on Wednesday, erasing the gains of the previous session, amid fears of a global economic slowdown curbing fuel demand, which overshadowed expectations of further supply cuts due to production cuts announced by Saudi Arabia and Russia for the month of August.
Brent crude fell 14 cents, or 0.2 percent, to $76.11 a barrel by 0027 GMT, after rising $1.60 on Tuesday.
US West Texas Intermediate crude futures reached $71.14 a barrel, up $1.35, or 1.9 percent, from Monday’s close, as Tuesday was a holiday in the United States.
Tomomichi Akuta, chief economist at Mitsubishi UFJ Research and Consulting, said in a report to Reuters: “Oil prices have come under pressure again due to continuing concerns about the global economic slowdown and rising interest rates in the United States and Europe.”
“We expect the market to continue to move in both directions for some time, focusing on economic indicators in China and monetary policy of central banks,” he said, expecting Brent crude to trade around $75 a barrel.
Saudi Arabia, the largest exporter of crude in the world, said on Monday that it will extend the voluntary production cut of one million barrels per day until August, while Russia and Algeria volunteered to reduce their production and export levels in August by 500,000 barrels per day and 20,000 barrels per day, respectively.
However, investors are still concerned about demand for oil after business surveys showed a slowdown in global factory activity due to slowing demand in China and Europe.
2023-07-05 04:43:04
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