Oil prices slightly decreased on Thursday following growing demand concerns in the US, the world’s largest oil-consuming country, and ongoing uncertainty about the timing of the US Federal Reserve’s (Fed) rate cut, while escalating tension in the Middle East limits further price decline.
International benchmark Brent crude traded at $84.44 per barrel at 10.25 a.m. local time (0725 GMT), a decrease of 0.03% from the closing price of $84.47 per barrel in the previous trading session.
The American benchmark West Texas Intermediate (WTI) traded at $80.84 per barrel at the same time, a 0.07% fall from the previous session that closed at $80.90 per barrel.
US commercial crude oil inventories increased by 0.8%, or about 3.6 million barrels, to 460.7 million barrels during the week ending June 21, the Energy Information Administration announced on Thursday. The market expectation was for stocks to decrease by about 2.6 million barrels.
Over the same period, gasoline inventories rose by approximately 2.7 million barrels to 233.9 million barrels.
Despite the summer period, when oil demand is typically high, data indicating an increase in US crude oil inventories raised demand concerns and supported lower oil prices.
Meanwhile, expectations that the Fed will cut its policy rate later than expected continue to fuel demand concerns among market players.
Fed officials continued their guidance with ‘cautious’ words throughout the week.
Analysts expect that the gross domestic product data due later in the day will give insight into the state of economic activity in the US. Investors will closely follow the personal consumption expenditures data, which the Fed considers an inflation indicator, scheduled for Friday.
However, escalating geopolitical tensions in the Middle East, home to a vast majority of global oil reserves, limited downward price movements by fueling market players’ concerns over the possibility of a disruption in global energy supply routes.
The Palestinian official news agency Wafa reported that the Israeli army shelled the al-Alami area in Jabalia, the largest refugee camp in the Gaza Strip, killing at least 8 Palestinians and injuring others.
According to reports, overnight Israeli airstrikes also targeted 5 homes across Gaza City, causing fatalities and injuries.
