During today’s trade, Thursday, May 18 (2023), crude oil prices edged lower amid fears of an economic slowdown that could hurt demand.
This boosted oil markets in the previous session on optimism about demand for US fuel, as traders cautiously awaited signs of progress in talks to raise the US debt ceiling.
Crude oil price today
At 06:52am GMT (09:52am Mecca time), benchmark Brent crude futures – for delivery in July 2023 – were down 0.35% at $76.69 a barrel.
West Texas Intermediate crude futures – for June 2023 delivery – fell 0.40% to $72.54 a barrel, according to data seen by the specialist energy site.
And crude oil prices ended yesterday, Wednesday, May 17, up around 3% on optimism about crude oil demand and the possibility of reaching an agreement on the US debt ceiling.
US oil stocks
A sharp decline in U.S. gasoline stocks as demand rose to its highest level since 2021 and hopes for talks on the U.S. debt ceiling helped the key benchmark crude oil rise above $2 on Wednesday.
On the other hand, U.S. oil inventories rose by about 5 million barrels in the week ended May 12, marking a second straight week of gains.
Yesterday, Wednesday, President Joe Biden and US Republican Congressman Kevin McCarthy confirmed their desire to quickly reach an agreement to raise the federal government’s debt ceiling by $31.4 trillion and avoid a catastrophic economic downturn.
After a month-long stalemate, Biden and McCarthy agreed Tuesday to hold direct talks; A debt deal must be reached and passed by both houses of Congress before the government runs out of money to pay its bills by June 1.
Oil price analysis
“Investors are waiting for more evidence that a deal is imminent,” said OANDA analyst Edward Moya. Reuters.
He added, “Crude oil needs a clear signal that the U.S. economy is avoiding economic disaster or that China’s recovery is regaining steam.”
Another factor influencing crude oil prices is the increasing likelihood of the US Federal Reserve raising interest rates.
ANZ Research, in a note on Thursday, raised market expectations for another hike, citing the strength of April economic data in the US, coupled with improved confidence in debt ceiling negotiations and the health of regional bank stocks.
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