Oil fell amid pressure from a stronger dollar, with traders largely ignoring a US inventories report that indicated tighter markets.
Crude oil pared all of its previous gains and closed in negative territory as risk-on sentiment in broader markets faded and traders trimmed their positions ahead of West Texas Intermediate’s August expiration on Thursday, rising volatility. The drop in the commodity came despite a US inventories report that showed inventories at the largest storage hub, Cushing, fell by the most since October 2021 last week. National inventories fell by 708,000 barrels, which traders said was not bullish enough to push prices higher.
Crude shipments from Russia fell to a six-month low in the four weeks to July 16. The curbs suggest Moscow is making good on a promise to its OPEC+ coalition partners to curb supplies. Russia said it aims to cut its third-quarter crude export plans by 2.1 million tonnes, in line with its previously stated pledge to cut overseas shipments by 500,000 barrels a day in August .
Oil has been hit in recent months as investors weigh China’s stuttering recovery against supply cuts by OPEC+ heavyweights Saudi Arabia and Russia and signs that the Federal Reserve could be close to concluding a cycle of interest rate hikes. Prices had made a sharp break higher since late June on signs that the market may finally be tightening, but are still lower for the year.
Prices:
- West Texas Intermediate for August delivery fell 40 cents to settle at $75.35 a barrel in New York.
- The August WTI contract expires on Thursday.
- Brent for September settlement fell 17 cents to settle at $79.46 a barrel.
