Oil erases all its gains and turns to decline, ahead of US data

2023-06-27 11:17:14
Oil prices

Oil prices erased all their early gains to turn dramatically downward by regarding 1 percent, amid anticipation of data that will shed light on the extent of Americans’ appetite for fuel during the summer driving season, with the price structure of benchmark Brent crude indicating a retreat from the bulls.

The American Petroleum Institute is due to release data on US stockpiles later in the day, followed by data from the government Energy Information Administration on Wednesday. A Archyde.com poll indicated that US inventories may have declined in the week ending June 23.

OPEC also expects global oil demand to increase to 110 million barrels per day, and total energy demand to rise by 23 percent by 2045.

This month, OPEC kept its forecast for global oil demand this year unchanged for the fourth month, but warned that the global economy is facing increasing uncertainty with slowing growth in the second half of the year.

price move

By 1042 GMT, Brent crude futures fell 74 cents, or 1 percent, to $ 73.44 a barrel, and US West Texas Intermediate crude futures fell 68 cents, or 0.98 percent, to $ 68.68 a barrel.

On Monday, Brent rose 0.5% and West Texas Intermediate rose 0.3%.

Oil markets were affected by fears that the Federal Reserve (the US central bank) would raise interest rates once more, which might undermine demand for oil at a time when the Chinese economic recovery disappointed investors.

On Saturday, a clash was avoided between Moscow and the Russian private military group, Wagner, as the group’s heavily armed fighters withdrew from the southern Russian city of Rostov under an agreement that halted their rapid advance towards the capital.

Lower supply is already in the minds of investors due to Saudi Arabia’s pledge to cut production from July.

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