Zhejiang, April 27 (BNA): Oil prices fell by about 4% today, Wednesday, to continue the sharp losses of the previous session, even after a report showed that US crude stocks fell more than expected, with growing fears of recession for the largest economy in the world, according to Reuters. mentioned.
Brent crude closed at $77.69 a barrel, losing $3.08, or 3.8 percent. US West Texas Intermediate crude settled at $74.30 a barrel, down $2.77, or 3.6 percent.
Energy Information Administration (EIA) data showing US crude inventories fell last week by 5.1 million barrels to 460.9 million barrels helped limit the price decline, far exceeding analysts’ expectations for a 1.5 million drop in a Reuters poll.
The Energy Information Administration said that gasoline and distillate inventories also declined, falling by 2.4 million barrels to 221.1 million barrels and by about 600,000 barrels to 111.5 million barrels, respectively.
“The complex appears to be more focused on a recession that may be on the way ahead rather than some of the current EIA statistics that are generally bullish,” said Jim Ritterbusch of advisory firm Ritterbusch and Associates.
The expectation that refinery activity will rise, with crude exports declining, will continue to push and pull for weeks.
“Refinery runs are set to pick up in the coming weeks, boosting the demand side of the ledger, but to counter this is the expectation of lower crude exports as the tightening of Brent and WTI spreads affects appetite for buying,” Matt Smith, a leading oil analyst said. For the Americas in Kpler.
Oil prices have reversed all their gains since the Organization of the Petroleum Exporting Countries (OPEC) and producer allies such as Russia, collectively known as OPEC+, announced in early April an additional production cut through the end of the year.
Russian Deputy Prime Minister Alexander Novak said on Wednesday that OPEC+ remains an effective coordination tool.
Oil prices fell more than 2% on Tuesday as persistent economic concerns and expectations of higher interest rates that could curb fuel demand growth reflected signs of improving consumption gains in the short term.
US consumer confidence fell to a nine-month low in April as concerns mounted, raising the risk of the economy falling into recession this year. New orders for major capital goods manufactured in the United States fell more than expected in March and shipments fell.
“This (data) will add credence to claims that the US economy is close to recession,” said Stephen Brennock of PVM Oil.
Investors are also worried that potential interest rate increases by central banks fighting inflation could slow economic growth and affect energy demand in the United States, Britain and the European Union.
The US Federal Reserve, the Bank of England and the European Central Bank are expected to raise interest rates at their next meetings. The Federal Reserve meets May 2-3.
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