Crude oil prices are down 1%, and Brent is near $74 a barrel

Crude oil prices are down 1%, and Brent is near $74 a barrel

Crude oil prices fell about 1% during trading today, Wednesday, May 17 (2023), to continue recording losses for the second day in a row, amid fears of declining demand.

Traders remained cautious after a surprise rise in US oil inventories raised concerns about demand in the wake of weaker-than-expected economic data from the US and China.

Crude oil prices today

By 07:10 AM GMT (10:10 AM Mecca), benchmark Brent crude futures – for July 2023 delivery – were down 0.75%, to $74.35 a barrel.

West Texas Intermediate crude futures – for June 2023 delivery – also fell by 0.90%, to record a barrel of $70.22, according to information seen by the specialized energy platform.

And crude oil prices ended their trading yesterday, Tuesday, May 16 (2023), in decline, after a volatile session, as the impact of weak economic data in China overshadowed the United States’ announcement of its plans to buy huge quantities of crude to fill its strategic reserves.

US oil stocks

US oil inventories rose by about 3.6 million barrels in the week ending May 12, according to market sources, citing figures from the American Petroleum Institute.

Oil reservoirs in Japan
Oil tanks in Japan – Photo courtesy of Reuters

7 analysts polled by Reuters expected a decline of 900,000 barrels, coinciding with US President Joe Biden’s administration announcing moves to refill the strategic oil reserves.

US government data on crude oil and product inventories from the Energy Information Administration is due at 02:30 AM GMT (05:50 PM Mecca time).

Crude oil inventories added to concerns about growth in the US, after data showed retail sales rose 0.4% in April, below estimates for a 0.8% increase.

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US debt crisis

Talks about raising the US debt ceiling continue to weigh on the market, with the US Treasury estimating that the US will default as early as June 1 if Congress does not raise the debt ceiling.

In China, industrial production and retail sales for April were lower than expected, indicating that the economy has lost momentum at the start of the second quarter.

“Sentiment soured amid stalled US debt ceiling talks and disappointing retail earnings overnight, as recession fears returned once again to global markets,” said CMC Markets analyst Tina Ting.

The markets are closely following any new moves on expanding sanctions against Russia by the G7 leaders when they meet in Japan on May 19-21.

Officials with direct knowledge of the discussions said the G7 is looking to target evasion of sanctions involving third countries, with the aim of limiting Russia’s future energy production and curbing trade that supports the Russian military.


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