Crude oil prices fell by more than 3%, at the end of trading today, Thursday, May 25, 2023, in light of the uncertainty about whether the United States will avoid debt default, and possible OPEC + cuts.
House Speaker Kevin McCarthy said, today, Thursday, May 25, that the negotiations witnessed some progress, but many issues remained unresolved.
Negotiators for US President Joe Biden and Republican Congressman Kevin McCarthy met on Wednesday, May 24, at the White House. to try to reach an agreement.
At the same time, Saudi Energy Minister Prince Abdulaziz bin Salman issued a warning to speculators. This led to speculation that the OPEC + alliance might discuss further production cuts during the next June meeting.
Crude oil prices today
At the end of the session, Brent crude futures contracts – delivery in July 2023 – fell by about 2.7%, to $ 76.26 a barrel, according to what was monitored by the specialized energy platform.
US West Texas Intermediate crude futures – July delivery – fell 3.4%, to $71.83 a barrel.
Crude oil prices had risen by about 2%, at the end of trading on Wednesday, May 24, 2023, amid increasing speculation about OPEC + to cut production and data on the decline in US oil stocks and fuel supplies.
For his part, Russian Prime Minister Alexander Novak said that he does not expect new steps from the OPEC + oil producers alliance at its meeting in Vienna, on June 4.
Oil price analysis
Market analyst at IG, Ip Jin Rong, said that the cautious cover of the risk environment caused by the uncertainty about the US debt ceiling has put crude oil prices in a wait-and-see state in the Asian session.
He added that the strength of the US dollar also contributed to keeping crude oil prices unchanged at the present time.
Oil prices in the previous session were supported by the Saudi Energy Minister’s warning that short sellers who bet on lower oil prices will remain in pain.
Some investors see the Saudi energy minister’s remarks as a sign that OPEC and its allies may discuss further production cuts at the next June meeting.
Meanwhile, US oil inventories faced a massive decline in the week ending May 19th, the Energy Information Administration reported Wednesday, May 24th.
US crude inventories fell by 12.5 million barrels, to 455.2 million barrels, with imports declining.
Analysts had expected a rise of 800,000 barrels, Reuters reported.
The Energy Information Administration said that gasoline stocks fell by 2.1 million barrels in the week, to 216.3 million barrels.
While distillate stocks – which include diesel, heating fuel and others – decreased by 600 thousand barrels, to 105.7 million barrels.
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