https://sputnikglobe.com/20220518/oil-prices-down-2-second-day-in-row-as-us-economic-worries-bite-1095615906.html
Oil Prices Down 2% Second Day in Row as US Economic Worries Bite
Oil Prices Down 2% Second Day in Row as US Economic Worries Bite
Sputnik International
NEW YORK (Sputnik) - Crude prices fell about 2% or more for a second straight day on Wednesday as traders looked beyond strong oil demand data released by the... 18.05.2022, Sputnik International
2022-05-18T20:19+0000
2022-05-18T20:19+0000
2022-05-18T20:19+0000
wti
oil prices
federal reserve
us economy
interest rates
gas prices
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New York-traded West Texas Intermediate (WTI) settled down $2.81, or 2.5%, at $109.59. The US crude benchmark has fallen 4% since Monday’s settlement. Prior to that, it rose 14.5% in total over four sessions that took it to a seven-week high of $114.90 on Monday.London-traded Brent settled down $2.82, or 2.5%, at $109.11 a barrel. The global crude benchmark has lost 4.5% in two days of trading, after rallying 12% in four prior sessions that it took to a one-month high of $114.79 on Monday.The drop in oil prices came despite the US Energy Information Administration reporting that crude stockpiles fell by 3.39 million barrels during the week to May 13, versus the 1.38-million barrel rise expected by analysts polled by US media. In the previous week to May 6, there was a build of 8.49 million barrels.Among gasoline inventories, there was a drop of 4.78 million barrels, against analysts’ consensus for a draw of 1.33 million barrels. In the prior week, there was a slide of 3.61 million barrels.With distillate stockpiles, there was an increase of 1.24 million barrels against expectations for a drop of 800,000 barrels. In the prior week, there was a drop of 913,000 barrels.Oil’s slide deepened as the US stock market tumbled on renewed concerns that a recession might hit the United States despite the assurance of the Federal Reserve that the economy, particularly, job market, was on strong footing.Oil prices also fell as some traders took profit on last week’s rally.On Wall Street, highly prized technology stocks on the Nasdaq fell more than 4%, resuming their tumble on growth concerns after a recent respite to the May selloff. Nasdaq has lost about 7% for all of May, while for the year it is down 26%.The Federal Reserve will raise interest rates non-stop and even slow the US economy if needed to bring inflation down from current 40-year highs, the central bank’s chairman Jerome Powell said Tuesday. Record high prices of fuel, with gasoline at above $4.50 per gallon at some US pumps and diesel at over $6, are accelerating inflation, and could eventually lead to demand destruction in energy as consumers find it increasingly hard to pay such prices, analysts said.US economic growth for this year is likely to come in at 2.4%, some 0.8% lower than the Fed’s estimate, as the Ukraine crisis causes more global negative shocks than expected, S&P Global said in an outlook on Wednesday.
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wti, oil prices, federal reserve, us economy, interest rates, gas prices
wti, oil prices, federal reserve, us economy, interest rates, gas prices
Oil Prices Down 2% Second Day in Row as US Economic Worries Bite
NEW YORK (Sputnik) - Crude prices fell about 2% or more for a second straight day on Wednesday as traders looked beyond strong oil demand data released by the US government to focus instead on economic worries from inflation running at 40-year highs.
New York-traded West Texas Intermediate (WTI) settled down $2.81, or 2.5%, at $109.59. The US crude benchmark has fallen 4% since Monday’s settlement. Prior to that, it rose 14.5% in total over four sessions that took it to a seven-week high of $114.90 on Monday.
London-traded Brent settled down $2.82, or 2.5%, at $109.11 a barrel. The global crude benchmark has lost 4.5% in two days of trading, after rallying 12% in four prior sessions that it took to a one-month high of $114.79 on Monday.
The drop in oil prices came despite the US Energy Information Administration reporting that crude stockpiles fell by 3.39 million barrels during the week to May 13, versus the 1.38-million barrel rise expected by analysts polled by US media. In the previous week to May 6, there was a build of 8.49 million barrels.
Among gasoline inventories, there was a drop of 4.78 million barrels, against analysts’ consensus for a draw of 1.33 million barrels. In the prior week, there was a slide of 3.61 million barrels.
With distillate stockpiles, there was an increase of 1.24 million barrels against expectations for a drop of 800,000 barrels. In the prior week, there was a drop of 913,000 barrels.
Oil’s slide deepened as the US stock market tumbled on renewed concerns that a recession might hit the United States despite the assurance of the Federal Reserve that the economy, particularly, job market, was on strong footing.
Oil prices also fell as some traders took profit on last week’s rally.
"It’s what you’d call a ‘buy-the-rumor, sell-the-fact’ day," John Kilduff, founding partner at New York energy hedge fund Again Capital, said. "Bulls in the market had been betting on some solid drawdown numbers for crude and gasoline even as the bears had expected otherwise, and some saw it fit to take the money they made off the table today. Also, there’s incessant noise on the US economy and fears of recession. All that’s weighing on stocks and markets in general."
On Wall Street, highly prized technology stocks on the Nasdaq fell more than 4%, resuming their tumble on growth concerns after a recent respite to the May selloff. Nasdaq has lost about 7% for all of May, while for the year it is down 26%.
"There are gloomy forecasts from central banks, with even the Fed now targeting a softish landing which feels very much like the stage before a mild recession," Craig Erlam, analyst at online trading platform OANDA, said. "It may be time to buckle up and prepare for a very bumpy year."
The Federal Reserve will raise interest rates non-stop and even slow the US economy if needed to bring inflation down from current 40-year highs, the central bank’s chairman Jerome Powell said Tuesday. Record high prices of fuel, with gasoline at above $4.50 per gallon at some US pumps and diesel at over $6, are accelerating inflation, and could eventually lead to demand destruction in energy as consumers find it increasingly hard to pay such prices, analysts said.
US economic growth for this year is likely to come in at 2.4%, some 0.8% lower than the Fed’s estimate, as the Ukraine crisis causes more global negative shocks than expected, S&P Global said in an outlook on Wednesday.
