Oil prices fell during trading hours in the United States today, Thursday, following crude stocks in the country recorded the highest level in months and amid signs that the Federal Reserve (the US central bank) may continue to raise interest rates.
Brent crude futures fell 69 cents to $84.40 a barrel by 1322 GMT, while US West Texas Intermediate crude futures fell 76 cents to $77.71.
Both benchmarks have risen more than 5 percent since the beginning of the week.
“The continued rise in US commercial inventories and potentially persistent inflation limits the prospects for any upside at the moment,” said Tamas Varga, an analyst at BVM.
He added that oil prices may be supported in the second half of the year as Chinese demand recovers and if inflation eases.
The US Energy Information Administration said that the country’s stocks of crude rose last week to the highest level since June 2021, supported by increased production.
US inventories of gasoline and distillates also rose last week.
Federal Reserve officials said further interest rate hikes are an option amid the central bank’s continued efforts to control inflation, which sends negative signals for riskier assets such as oil and stocks.
But crude prices received some support from hopes for a quick recovery in demand from China following the world’s second largest oil consumer ended its strict three-year zero Covid policy.
And BP Azerbaijan announced a state of force majeure on loading Azeri crude from the Turkish port of Ceyhan on February 7, following a strong earthquake struck Turkey and Syria early on Monday. But the company said today that oil flows continue through the pipeline.