According to a Reuters report, the price of oil fell by almost 3% on Friday, with a weekly decline brought on by worries about a potential rise in U.S. Federal Reserve interest rates and indications of ample supply.
In addition, it became more expensive for owners of other currencies due to the rise in the U.S. dollar, which was brought on by predictions of an increase in borrowing costs.
As a result, West Texas Intermediate (WTI) crude slid 2.6% to $76.42 per barrel, and Brent crude futures fell 2.8% to $82.77 per barrel. Both benchmarks were expected to drop by more than 4% every week.
“The worries surrounding rate hikes have “returned with a fury,”
According to Stephen Brennock of the oil dealer PVM—several indications of a plentiful supply impacted the market.
Notwithstanding the government’s intention to reduce oil production in March, Russian oil companies expect to maintain current levels of crude oil exports, according to the Vedomosti newspaper.
Meanwhile, according to the most recent U.S. supply snapshot, crude stockpiles reached their highest level since June 2021 in the week ending Feb. 10 after rising by 16.3 million to 471.4 million barrels.
Saudi Arabia’s energy minister stated that the current OPEC+ agreement, which includes OPEC producers and Russia, to decrease oil output targets by 2 million barrels per day would be locked in until the end of the year while remaining cautious about Chinese demand.
Despite the International Energy Agency and the Organization of the Petroleum Exporting Countries increasing their forecasts for global oil demand growth this year, citing expectations for more Chinese demand.
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