Market Reaction
NEW YORK — Oil prices edged lower on Wednesday after new government data showed an increase in US diesel inventories, sparking concerns about slowing demand. The decline came as the Federal Reserve moved ahead with a widely expected interest rate cut.
Brent crude futures settled at $68.22 per barrel, down 52 cents, while US West Texas Intermediate (WTI) fell 47 cents to $64.05.
Inventory Data and Demand Outlook
The US Energy Information Administration reported a sharp drop in crude oil inventories due to higher exports and fewer imports. However, the rise in distillate stockpiles — including diesel — pressured prices.
“Markets are reacting to diesel, which has become the weak spot across the energy complex,” said Phil Flynn, senior analyst at Price Futures Group.
Federal Reserve Rate Cut
The Federal Reserve lowered interest rates by a quarter of a percentage point, signaling plans for further cuts later in the year. Analysts noted the move was anticipated, but the impact on energy demand remains uncertain.
Global Supply Developments
- Kazakhstan resumed oil flows through the Baku-Tbilisi-Ceyhan pipeline on Sept. 13 following last month’s contamination-related suspension.
- Nigeria ended a six-month emergency rule in Rivers State, a key hub for crude exports.
- Russia faces continued supply risks as Ukrainian drone strikes have targeted refineries and export ports. Russia’s state pipeline operator, Transneft, has warned producers of potential output cuts if attacks persist.
Outlook
Traders remain focused on both demand signals in the US and the risk of further supply disruptions abroad. While falling inventories typically support prices, concerns over refined product demand and macroeconomic uncertainty continue to weigh on the market.
Related Coverage
- Economy & Market – https://idahonews.co/economy-market/
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