Crude oil prices fell by more than 3% at the end of their trading today, Wednesday, February 22 (2023), due to fears of a decline in demand, so that US crude continued to decline for the sixth session in a row.
This comes amid expectations that the US Federal Reserve will continue to raise interest rates, which raises fears of slowing global economic growth.
Crude oil prices today
At the end of the session, Brent crude futures prices – for delivery in April 2023 – fell by 2.9%, to reach $80.60 per barrel.
The price of US West Texas crude futures – delivery in April 2023 – decreased by 3.2%, to $ 73.95 a barrel, according to data viewed by the specialized energy platform.
Crude oil prices ended their trading, yesterday, Tuesday, February 21, in decline, as crude oil prices fell by more than 1% due to fears of a slowdown in the global economy, and a decline in demand for fuel.
Economic recession
The US Federal Reserve showed in the minutes of its last meeting today, Wednesday, that monetary policy makers expect to continue raising interest rates to control inflation.
Higher interest rates tend to push up the dollar, making oil denominated in the greenback more expensive for holders of other currencies.
Other economic reports from the United States, the world’s largest oil consumer, showed some worrying signs. Home sales in January fell to their lowest level since October 2010, the 12th monthly decline, the longest streak since 1999.
Oil market analysis
Growing fears of a recession are keeping crude oil prices in check, but the market is cautiously optimistic about a recovery in demand in China, especially in gasoline and jet fuel, said Serena Huang, Head of Asia Pacific Analysis at Vortexa.
Yesterday, Tuesday, a preliminary poll of Reuters analysts showed a rise in US oil stocks, which exacerbated demand concerns.
However, expectations of dwindling global supplies and increased demand from China moderated the decline in crude oil prices overall.
demand for oil
Analysts expect China’s oil imports to reach a record level in 2023, to meet growing demand for transportation fuels and as new refineries come online.
It comes as China expects the tourism market to boom this year, starting with a busy and robust summer travel season, as travelers flock to holiday destinations after the government ended a coronavirus policy that kept people at home for nearly 3 years.
The chief commodity strategist at ANZ Bank, Daniel Heinz, indicated, in a note, that PetroChina and Unipec, owned by the Chinese government, had booked 10 giant tankers to import oil from the United States next month, which is equivalent to about 20 million barrels of crude oil, which are indicators. On the rise in Chinese demand.
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