Oil Trading Daily: WTI Crude Hammered, Falls 5%

Oil prices fell on Wednesday as WTI crude oil closed 5.3% lower to settle at $72.84. Oil prices have so far been unable to break above the crucial $80 barrier.

In other news, according to Reuters, Saudi Arabia could slash the selling price for its Arab Light crude further for its Asian buyers. Aramco has already lowered the price of its crude oil for its Asian buyers to the lowest level in the past 10 months at a premium of $3.25 to the Dubai/ Oman benchmark for its January shipments.

According to the report, this price could now be reduced by another $1.50 per barrel for February shipments.

While Asia has become a primary destination for oil supplies from Russia, Europe has turned to the Middle East amid an embargo on Russian oil.

It remains to be seen where oil prices go from here amid geopolitical conflicts and the actions of the U.S. Fed and OPEC.

Meanwhile, natural gas jumped up by 4.6% to close at $4.172. Despite today’s move, demand weakness persists. This is a steep correction as compared to the August 2022 $10 levels as a confluence of a warmer start to 2023, a ramp-up in U.S. natural gas production, and rising gas reserves in Europe are keeping prices in check.

In addition, the Energy Select Sector SPDR ETF (XLE) finished 0.26% lower.

Here are related tickers for this article:

• United States Oil Fund LP (USO)
• ProShares Ultra Bloomberg Crude Oil (UCO)
• United States Natural Gas Fund LP (UNG)
• Cheniere Energy (LNG)
• ConocoPhillips (COP)
• Chevron (CVX)
• Exxon (XOM)
• Occidental Petroleum (OXY)

Meanwhile, the slide in oil prices aside, U.S. oil giants like XOM and CVX are set to reap rich profits for 2022 and could together rake in $100 billion.

When it comes to XOM stock, analysts are cautiously optimistic about the stock, with a Moderate Buy consensus rating based on nine Buys and six Holds.