Decrease In Global Oil Prices Due To The Release Of U.S. Crude Oil Reserves
Oil prices fell on Tuesday after the U.S. government announced it would extract more oil from the country's Strategic Petroleum Reserve as ordered by lawmakers, defying some traders' expectations that supply would be canceled or delayed.
Brent crude oil futures were down 70 cents, or 0.81 percent, at $85.91 a barrel per hour, while U.S. crude oil futures were down 93 cents, or 1.16 percent, at $79.21 a barrel. Each barrel arrived.
After the previous meeting, the U.S. Energy Department announced that it would sell 26 million barrels of oil from the Strategic Petroleum Reserve, news that would likely push the stockpiles to their lowest level since 1983.
"Energy traders expected to hear news about replenishment of strategic oil reserves and not use them to secure more supplies," said OANDA analyst Edward Moya.
After the Joe Biden administration sold 180 million barrels of its oil reserves last year, the U.S. Department of Defense considered canceling the sale in the fiscal year 2023. But that would require Congress to act to change that mandate.
Traders are looking for clues from important January US consumer price index data. U.S. monthly consumer prices rose in the past two months instead of falling as previously estimated, raising the risk of inflation rising in the coming months.
"Any higher-than-expected data could trigger a sell-off in risk assets, including oil," said Tina Teng, an analyst at CMC Markets.
Supply concerns also eased after the Energy Information Administration said it expected record production in March from seven major US shale fields. In other cases, crude oil exports resumed at an important Turkish port after a devastating earthquake rocked the region.
OANDA's Moya said: "Oil is on the defensive and if it proves to be more difficult to contain inflation, it could make matters worse."
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