ARKANSAS, Oct 25 (Future Headlines)- The American Petroleum Institute reported a surprising decrease in U.S. crude supplies by approximately 2.7 million barrels for the week ending on October 20, contrary to expectations of a 200,000-barrel increase, as projected by analysts polled by Reuters. U.S. government data on inventories was scheduled for release later on Wednesday. In the wake of this industry data, Brent crude futures saw a minor increase of 2 cents to reach $88.09 a barrel, while U.S. West Texas Intermediate crude futures decreased by 5 cents to settle at $83.69 a barrel.
It’s important to note that the benchmark oil prices had experienced declines in each of the three previous sessions. On the global front, concerns loomed over the eurozone’s economic activity data, which showed an unexpected downturn this month, raising the possibility of the bloc slipping into recession. This, in turn, cast a shadow on the outlook for oil demand. Germany’s data indicated that the country might already be in a recession, and Britain’s businesses reported a decline in activity, suggesting recession risks.
Additionally, the ongoing situation in the Middle East remained a point of concern. Investors were apprehensive about a potential escalation of the conflict in the region, as it could disrupt oil markets and supplies. Several countries, including the United States, Canada, Russia, and Arab states, called for a pause or ceasefire in the fighting between Israel and Hamas in the Gaza Strip. The aim was to facilitate the delivery of humanitarian aid to besieged Palestinian civilians. This geopolitical tension in the Middle East had the potential to impact global oil markets.
Writing by Sarah White