Thursday, December 1, 2022

Texas oil falls 3.71% and closes at US$77.94 a barrel

The price of intermediate oil from Texas (WTI) fell this Wednesday by 3.71% to US$77.94, after reports that the G7 and the European Union (EU) are negotiating the imposition of a cap on the price of Russian oil and after an unexpected increase in gasoline inventories in the United States.

At the end of trading on the New York Mercantile Exchange (Nymex), WTI futures contracts for January delivery lost $3.01 from the previous day’s close.

The Wall Street Journal reported today that the United States and the EU could set the ceiling between US$60 and US$70 a barrel, but this measure needs a unanimous position, so some diplomats see its approval as likely not to be immediate.

The plan, which was proposed by US Treasury Secretary Janet Yellen, aims to reduce Russia’s revenue from its crude exports and prevent the price of oil from rising further.

German Chancellor Olaf Scholz said today that he is confident that an agreement will soon be reached at the European level to impose this cap on the price of Russian oil.

On the other hand, the US Energy Information Agency announced today that gasoline inventories in this country increased last week by 3.1 million barrels, well above the 383,000 that analysts had forecast.

“The increase in gasoline inventories suggests that perhaps we are seeing a weakening of demand,” said Price Futures analyst Phil Flynn, quoted by CNBC.

Yesterday, the price of crude oil moved up after the Saudi energy minister, Abdulaziz bin Salmán, denied that OPEC was considering reducing oil production in anticipation of new sanctions against Russian oil, as some reports pointed out.

On the other hand, natural gas futures contracts for January added 30 cents to $7.7, and gasoline futures due the same month fell 5 cents to $2.39 a gallon.

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