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Oil prices hover around multi-week lows on demand worries

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SINGAPORE/MELBOURNE: Oil prices were hovering around multi-week lows on Thursday like worries about falling PEOPLE gasoline demand and slow economic recovery from the COVID-19 pandemic dented sentiment.

US West Texas Intermediate (WTI) crude futures were upward 4 cents, or zero.10%, at $41.55 a barrel by 0626 GMT. Brent crude dropped 1 cent, or zero.02%, to $44.42 a barrel.

Both bench-marks fell more than 2% on Wednesday, with WTI slipping to its lowest near in nearly four weeks plus Brent at its weakest due to the fact Aug. 21.

US fuel demand last week fell to eight.78 million barrels each day (bpd) from 9.16 million bpd a week previously.

Other data, such as PEOPLE private employers hiring less workers than expected to get a second straight month that kicks off in august, also fed fears the fact that economic recovery was lagging.

Oil markets, however, attracted some support from Iraq’s denial it was seeking permission from OPEC+ oil reduces during the first quarter regarding next year.

Analysts warn the fact that upcoming refinery maintenance plus the end of summer driving a vehicle season would also reduce primitive demand.

WTI crude has come under pressure “after PEOPLE refiners earmarked a long list of servicing closures over the coming many months that will no doubt impact demand for crude oil”, ANZ Research said in a notice on Thursday.

“This will be compounded by weak improvement margins, which are their least expensive in nearly a decade with this time of the year.”

Due to help shutdowns ahead of Hurricane Laura, US refinery utilization costs fell by 5.a few percentage points to 76.7% of total capacity.

“These factors suggest a in season drop off in refinery goes and higher oil catalog levels as we advance by September,” AxiCorp market strategist Stephen Innes mentioned.

Commonwealth Bank (CBA) estimations Brent will average $46 in the fourth quarter in advance of rising to $55 right at the end of 2021.

“There is plenty spare oil capacity plus enough pressure on demand growth to justify just a gradual increase in oil prices over the next 12 many months,” CBA commodities expert Vivek Dhar said inside a note.

The Organization from the Petroleum Exporting Countries plus allies, a grouping often known as OPEC+, is currently cutting end result by 7.7 thousand barrels per day (bpd) right until December to support prices as being the coronavirus crisis hammers demand.

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