Oil prices increased on Thursday. But were unable to recover from a more than 9% drop over the previous three days. As demand concerns among major consumers outweighed hints that the United States may suspend interest rate hikes.
Brent futures were up 50 cents, or 0.7 percent, at $72.83 per barrel as of 06:39 GMT. Brent, on the other hand, has plummeted more than 9% since Friday, falling as low as $71.28 earlier on Thursday.
The price of West Texas Intermediate oil in the United States climbed 28 cents, or 0.4%, to $68.88 per barrel. WTI plunged about 11 percent from Friday – Wednesday’s closing, reaching as low as $63.64 earlier on Thursday, the lowest since December 2, 2021.
As all the negative supply & demands news has already been factored in, Edward Moya, an analysts at OANDA, stated that “oil is starting to find few support.”
Prices have fallen this week due to worries about the US economy, indications of weak manufacturing development in China, the top oil importer in the world. And after the US Federal Reserve on Wednesday boosted interest rates to their highest level since 2007. Which may have the effect of slowing down economic growth in the near future.
At the beginning of this month. The Organisation of the Petroleum Exporting Countries (OPEC) and its allies. Which includes Russia, started voluntary output cuts of about 1.16 million barrels per day. These cuts are expect to support the market as we move into the summer peak demand period.
It appears like OPEC+ will be under pressure to finally demonstrate that they can fulfil those production cut limits and maybe be in a position to announce that greater cuts are on the way. According to Moya.
Investors are also anticipating news from the European Central Bank. Which is scheduled to hike interest rates on Thursday for the seventh consecutive meeting.
Concerns about Chinese demand are still present in the market, particularly in light of a private sectors survey released on Thursday that revealed surprisingly lower manufacturing activity in April as a result of weaker domestic demand.