Brent oil fell to $97.6 per barrel

Oil prices went down during trading on Thursday on fears of a sharp increase in the Fed’s rate and data on the growth of fuel inventories in the United States.

September futures for Brent on the London ICE Futures exchange by 13:51 Moscow time fell by $1.94 (1.95%) to $97.63 per barrel, which is the lowest level since April.

The cost of futures for WTI for August at the electronic session of the New York Mercantile Exchange (NYMEX) fell by this time by $2.32 (2.41%) – to $93.98 per barrel.

„Attention is now on the demand side. Yesterday’s weak report from the Ministry of Energy recorded a significant increase in oil stocks,” said Tamas Varga, an analyst at PVM Oil Associates.

„The collateral damage of rising inflation fears is a strong dollar that is also weighing on oil prices. Curiously, the physical market is still strong, but the change in investor sentiment is the main driving force,” he added.

As it became known the day before from the report of the Ministry of Energy, oil reserves in the United States last week increased by 3.25 million barrels, commodity reserves of gasoline increased by 5.82 million barrels, distillates – by 2.67 million barrels. Experts expected a decrease in oil reserves and a less significant increase in reserves of petroleum products.

In addition, inflation in the US (CPI index) accelerated to 9.1% in June from 8.6% in May, hitting the highest since November 1981. Analysts on average expected consumer prices to rise 8.8%.

According to traders, the acceleration of inflation has increased the likelihood that the US Federal Reserve may raise rates at the July meeting by 1 percentage point instead of 75 basis points. Such a sharp tightening of monetary policy could hasten the onset of a recession in the world’s largest economy.

Steve Walker

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