Oil prices dipped below $82 on international markets on Thursday, weighed down by concerns that an anticipated increase in interest rates in the United States of America (US) would slow down the economy and reduce demand.
According to the latest data published on OilPrice.com on Friday, the price of Brent oil continued its decline and currently stands at $81.05, while Texas WTI crude is trading at $77.32.
On the London market, the price of a barrel was $1.65 lower after noon on Thursday compared to the previous closing, amounting to $81.47. In New York, a barrel was traded at a reduced price of $1.61, down from $77.55.
Traders are closely monitoring the possibility of a quarter-percentage-point increase in US interest rates in May, as predicted by economists surveyed by Reuters. Such a move would mark the end of the most aggressive monetary policy tightening cycle in 40 years. This forecast is based on an assessment of the continued robust pace of employment in the world’s largest economy, following the latest data that showed only a modest increase in new jobless claims last week.
Oil Supply Concerns and International Developments
Pressure on prices also came from reports within trade and logistics circles suggesting that oil loadings at ports in western Russia in April are likely to reach their highest level since 2019, hinting at an increase in supply.
Meanwhile, the oil minister announced that Pakistan had placed its first order for oil from Russia at a reduced price under a new contract that could involve around 100,000 barrels per day.
Interest rates and increased supply concerns overshadowed the news that crude oil stocks in the US fell by 4.6 million barrels last week due to increased processing in refineries and higher exports, as reported by the Ministry of Energy. Gasoline inventories, however, experienced a sharp rise due to disappointing demand.
In a separate announcement, the Organization of the Petroleum Exporting Countries (OPEC) reported that on Wednesday, the price of a barrel of the oil basket of its members dropped by $1.1 to $84.41.
