On Wednesday, oil prices experienced a decline, driven by data revealing a larger-than-anticipated increase in crude inventories in the US, indicating a reduction in demand from the world's leading oil consumer.
The international benchmark Brent crude traded at $82.20 per barrel at 10:17 a.m. local time (0717 GMT), marking a 0.56% decrease from the previous trading session's closing price of $82.66 per barrel.
Simultaneously, the American benchmark West Texas Intermediate (WTI) traded at $78.36 per barrel, reflecting a 0.65% decline from the previous session's closing price of $78.87 per barrel.
According to the American Petroleum Institute's latest estimate released on Tuesday, crude oil inventories surpassed market expectations, rising by 8.42 million barrels last week. This marks the fourth consecutive week of increases, compared to the market's prediction of a 1.8 million barrel rise in stocks.
Official stock data from the US Energy Information Administration is scheduled for release later on Wednesday.
The US dollar index, which measures the dollar's value against other currencies, rose by 0.16% to 103.99. This strengthening dollar is anticipated to dampen demand by increasing the cost of oil for holders of foreign currencies.
Uncertainty regarding the timing of potential interest rate reductions by the US Federal Reserve also contributed to the decline in prices.
Analysts are closely monitoring the release of economic indicators in the US this week, as well as speeches from Fed officials, for insights into the Fed's interest rate policy.
Fed Board member Michelle Bowman stated on Tuesday that the central bank is not rushing to cut interest rates, citing upside risks that could impede progress in reducing inflation and lead to renewed upward pressure on prices.
However, recent US macroeconomic data signals a slowdown in growth, raising concerns about a decline in oil demand.
Durable goods orders in January unexpectedly dropped by 6.1% month-on-month, marking the sharpest decline since April 2020.
Data on US Consumer Confidence, a survey measuring various consumer sentiments and economic factors, revealed a monthly decrease of 4.2 points to 106.7 in February, marking the first decline in four months.
Despite these factors, ongoing geopolitical tensions in the Red Sea and reports indicating a potential extension of supply cuts by OPEC+ have helped mitigate further declines in prices.
News ID : 2876