Oil fell after the close of the regular trading session on a Bloomberg News report that the US plans to sell more crude from the Strategic Petroleum Reserve, adding supplies to an already saturated market.
The United States wants to sell another 26 million barrels from the reserve, and deliveries will take place between April and June. West Texas Intermediate, the US crude benchmark, fell 1% to near $79 a barrel after Monday’s announcement.
The non-emergency sale of the SPR was mandated by legislation in 2015, and the Energy Department had tried to halt some of those releases to replenish the emergency stockpile. Some market participants had expected this scheduled sell-off to be canceled or extended later in the year, said Scott Shelton, energy specialist at ICAP.
Crude oil has had a bumpy start to 2023, bouncing within a band around $10 as Russia’s war in Ukraine continues to weigh on the energy market. On the demand side, the outlook is boosted by China’s emergence from the Covid brakes, but constrained by investor concerns that higher US interest rates will trigger a recession.
Prices and other news:
- WTI for March delivery rose 14 cents to settle at $80.14 a barrel in New York
- It fell 88 cents to $79.26 at 3:21 p.m. after markets settled.
- Brent for April settlement gained 22 cents to $86.61 a barrel.
