Oil Slides to $80 as Demand Slows
Oil prices slid to $80 as global demand slowed down following multiple economic uncertainties. On Monday, the oil market extended the sell-off from the end of last week amid slowing demand and rising ex-OPEC supply, ING commodities strategists said in a note.
Brent crude declined to $80.60 per barrel, which is a 0.25% decrease from the closing price of $80.80 a barrel in the previous trading session. American benchmark West Texas Intermediate (WTI) traded at $76.24 per barrel after losing 0.33% from the previous day.
The strong US dollar has raised energy costs, thus forcing reduced demand. Investors are awaiting the Fed’s preferred measure of inflation, the PCE price index, which will be released on Thursday.
Markets are also awaiting oil demand data from the US Energy Information Administration (EIA) to be released on Wednesday. US stockpiles showed an increase of around 3.5 million barrels last week; however, if stocks continue to rise, oil prices are expected to further decline.
Nevertheless, because of the associated supply risks, the unfolding geopolitical tension in the Middle East could still drive prices upward.
Yemen’s Houthi group said late Saturday that it would allow the British ship Rubymar sunk in the Gulf of Aden to be salvaged in exchange for bringing relief aid into the Gaza Strip. On Sunday, a Yemeni civilian was killed and six others injured in US and British attacks in the southern city of Taizz.
Weekly data from Baker Hughes shows that the US oil rigs rose by six rigs (the biggest weekly addition since February 2023) over the last week, with the total oil rig count standing at 503 for the week ended 23 February 2024, the highest rig count since the week ending 1 December 2023. #Oil Slides to $80 as Demand Slows
