Oil Prices Drop Again, Oil prices are now experiencing a decline, after experiencing the largest increase again. This is because Russia is known to have cut its supply, demand for jet fuel is slower than expected, and the Fed’s decision.
Based on data on Tuesday (19/3/2024), the price of West Texas Intermediate (WTI) oil for the April 2024 contract weakened -0.36% or -0.30 points to US$82.42 per barrel. Meanwhile, the price of Brent oil for the May 2024 contract also weakened -0.44% or -0.38 points to US$86.51 per barrel.
It is known that according to Gunvor Group Ltd., about 600,000 barrels of Russia’s daily refining capacity has been stopped. Meanwhile JP Morgan Chase and Co. estimates as much as 900,000 barrels.
Then for OPEC+, Iraq announced plans to reduce oil exports in the coming months to compensate for non-compliance with previous promises to reduce production.
Oil Prices Drop Again, New data from China shows that the country’s factory output and investment growth was stronger than expected at the start of this year. The Bamboo Curtain country also refines crude oil in record quantities.
Quoting Reuters, oil prices are also weighed down by how United States (US) interest rates will pan out, ahead of the country’s central bank meeting.
According to Suvro Sarkar, DBS Bank’s energy sector team leader, oil prices have risen quite a lot in the last two weeks considering the higher geopolitical risk premium following the attacks on Russian refineries.
Sarkar then argued that there might be action at this level, as he doubted that price movements above US$85 barrels per metric ton would be sustainable in the short term for Brent.
On the demand side, analysts are a little cautious about demand growth coming from the jet fuel sector, ahead of the summer travel season in the third quarter of 2024.
