2023-09-26 12:18:16
London: Oil prices fell on Tuesday, weighed down by the environment of high key rates in many consumer countries, as well as the lifting of certain restrictions on exports of Russian petroleum products. Around 10:40 a.m. GMT (12:40 p.m. CET), the barrel of Brent BRENT Brent, or North Sea crude, is a variation of crude oil serving as a benchmark in Europe, listed on the InterContinentalExchange (ICE), a stock exchange specializing in energy trading. It became the first international standard for setting oil prices. from the North Sea, for delivery in November, lost 0.76% to 92.58 dollars.
Its American equivalent, the barrel of West Texas Intermediate (WTI WTI West Texas Intermediate (WTI), also called Texas Light Sweet, is a variation of crude oil that serves as a standard in setting the price of crude and as a raw material for oil futures contracts with the Nymex (New York Mercantile Exchange). ), the stock exchange specializing in energy.), for delivery the same month, slipped 0.77% to 88.99 dollars.
A few days following the two global benchmarks for black gold reached their highest levels since November, “the market seems reluctant to continue its progression, at least for the moment (…) in a context of inflationary fears and high interest rates”, comment analysts from Energi Danmark.
The decline in black gold prices “might be the consequence of the decisions taken last week by central banks in terms of interest rates”, confirms Tamas Varga, analyst at PVM Energy.
???????? On Wednesday, the American Federal Reserve (Fed) announced that it would maintain its rates in the range of 5.25 to 5.50% while forecasting an additional increase by the end of the year, and rates slightly above 5.0% in 2024, higher than expected.
???????? The European Central Bank (ECB), but also its counterparts in Sweden and Norway, have raised their rates by 0.25 percentage points.
???????? The Bank of England (BoE) chose Thursday to leave its rates unchanged, also following in the footsteps of the Swiss Central Bank, but neither rule out a new turn of the screw.
The demand for crude oil from consuming countries is linked to their growth. However, high interest rates for a long period, in order to extinguish the surge in inflation, tend to weigh on the economy.
However, “oil supply is expected to be lower than demand for the foreseeable future and, therefore, any weakness (…) is not expected to last”, tempers Mr. Varga.
Prices also eased with Russia’s decision to lift certain restrictions on its exports of refined petroleum products.
“Therefore, the export of certain marine fuels and diesel with a higher sulfur content remains permitted. Fuels for which an export permit has already been granted are also exempt,” explains Carsten Fritsch, analyst at Commerzbank.
DNB analysts also mention “the general trend of risk aversion” in the market, which benefits safe havens like the dollar, and weighs on assets like oil, which are more volatile.
Especially since the prices of black gold are denominated in greenbacks, an appreciation of the American currency discourages oil purchases by reducing the purchasing power of buyers using foreign currencies.
(c) AFP
Comment Oil falters between high rates and lifting of certain Russian restrictions
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