Oil drops for second day as supply-driven rally falters

0

The silhouette of an oil pump is visible at sunset.

Pramote Polyamate | Getty Images

Oil prices fell for the second day in a row on Wednesday as doubts re-emerged over demand, with cases of Covid-19 continuing to rise around the world and gasoline shortages in some areas.

Brent crude was down $ 1.03 or 1.3% to $ 78.06 a barrel at 1:30 a.m. GMT, after falling nearly $ 2 on Tuesday after hitting $ 80.75, its highest level in near three years.

US oil fell $ 1.02 or 1.4% to $ 74.27 a barrel, after losing 0.2% in the previous session.

Oil prices have risen as economies recover from pandemic lockdowns and demand for fuel increases, while some producing countries have experienced supply disruptions.

Traders expect the Organization of the Petroleum Exporting Countries (OPEC) and its allies, commonly known as OPEC +, to decide to maintain the supply when they meet next week.

“While the supply backdrop has not changed much, oil prices reaching USD 80 / bbl would see increasing pressure for OPEC + countries to increase their production quota,” ANZ Research said in a statement. note.

Demand for oil is expected to rise sharply over the next few years, according to OPEC forecasts on Tuesday, warning the world must continue to invest in production to avoid a crisis even as it shifts to less energy forms. polluting.

China’s weakening housing market and growing power outages have shaken confidence, as any fallout for the world’s second-largest economy would likely have a ripple effect on oil demand, analysts said.

China is the world’s largest importer of oil and the second largest consumer of fossil fuel after the United States.

US inventories of crude oil, gasoline and distillate rose last week, according to market sources, citing figures from the American Petroleum Institute on Tuesday.

Crude inventories rose 4.1 million barrels for the week ending September 24. Gasoline inventories increased by 3.6 million barrels and distillate inventories increased by 2.5 million barrels, according to the data, which requested anonymity.

Share.

About Author

Leave A Reply