Oil prices decline

22 May 2024 , 08:38 AM

Wednesday saw a decline in spot oil prices for the third session in a row.

Futures for Brent crude dropped by 43 cents, or 0.5%, to $82.45 a barrel. West Texas Intermediate (WTI) oil futures fell 50 cents, or 0.6%, to $78.16. On Tuesday, oil prices ended the day around 1% lower.

On Tuesday, policymakers at the Federal Reserve stated that before lowering interest rates, the United States central bank should wait a few more months to make sure that inflation is actually returning to its target of 2%.

Costlier borrowing may put pressure on the demand for oil and hamper economic growth.

According to market sources quoting American Petroleum Institute (API) data on Tuesday, U.S. crude oil and petrol stockpiles increased last week while distillates decreased.

Retail petrol prices decreased for a fourth straight week ahead of this weekend’s Memorial Day vacation, which marks the beginning of the U.S. prime summer driving season. Diesel, a vital refined product for the transportation and industrial sectors, is now less expensive in the US.

The weekly U.S. oil inventory data from the U.S. Energy Information Administration (EIA), which is expected later on Wednesday, and the minutes from the Fed’s most recent policy meeting are eagerly awaited by investors.

With a more optimistic view for the economy, the euro zone has all but guaranteed a rate reduction on June 6. In an interview that aired on Tuesday, Christine Lagarde, the president of the European Central Bank, expressed her “great confidence” that inflation in the euro zone was under control.

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