WTI crude oil continued to fall on Wednesday, with WTI Crude oil declining by 0.5% to settle at $78.59. Meanwhile, natural gas prices fell by 3.74% to close at $2.471.
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The fall in oil prices came as the American Petroleum Institute (API) figures indicated that crude stocks in the U.S. have risen more than the forecast of 10.5 million barrels. Indeed, the official data from the U.S. Energy Information Administration (EIA) shows that crude oil inventories increased by 16.283 million barrels. For reference, forecasters were expecting 1.166 million.
Oil traders are expecting a further hike in U.S. interest rates as the CPI report indicated higher-than-expected inflation even as core CPI remained stable. Even Federal Reserve officials indicated on Tuesday that the Fed will continue to increase interest rates to cool down inflation.
A report from the International Energy Agency (IEA) indicated that globally, oil supply is likely to outstrip demand in the first half of this year, “but the balance could quickly shift to deficit as demand recovers and some Russian output is shut in.” The report also stated that China could make up more than 50% of global oil demand.
Latest numbers from the Energy Information Administration indicate natural gas inventories in the U.S. dropped by 217bcf to 2,366bcf in the week ended February 3.
Furthermore, the Energy Select Sector SPDR ETF (XLE) is down 0.21% over the past five days. Here is a list of energy stocks that can be influenced by the latest developments in the energy markets.
