In the face of a flabbergasting build-up in US crude stockpile, both US WTI (West Texas Intermediate) alongside UK crude oil contracts’ prices fell over 1.0 per cent on Wednesday, while hawkish remarks from Fed officials coupled with a number of malevolent economic data had stoked frets of an impending recession in the US, eventually causing worries over oil demands while prompting the investors to turn their tails.
In the matter of the fact, in the day’s major driver in a mass-scale downward spiral in crude oil futures’ prices, had been a surprise build-up in US crude stockpile as beforementioned, as data from the American petroleum institute had unfurled that US crude inventories surged by 7.6 million barrels over the week than ended on January 13.
However, although, US crude stockpile rose unexpectedly last week, a weakening in factory output, accountable for nearly an 11.3 per cent of entire US economic activity, alongside a tottering in US retail sales, had stoked frets of a havoc-scale drop in demands, eventually adding to further holocaust on crude oil futures’ prices.
Apart from that, US Fed officials were quoted as saying earlier in the day that the US Fed needed to raise its benchmark borrowing cost above a 5.0 per cent level, which in effect had feathered up recession worries further and dragged down the Wall St.
alongside commodity markets across the US.
Oil falters amid surprise US crude stockpile build-up, demand concerns
Citing statsitics, in the day’s commodity market wind-up, US WTI crude oil futures’ prices faltered 1.1 per cent to $78.62 a barrel, while UK crude oil futures’ prices pummelled as much as 0.9 per cent to $84.25 per barrel.
Meanwhile, addressing to hawkish remarks of the Fed officials, an ANZ Research analyst wrote in a client note, “his raised the spectre of a recession, with risk appetite suffering as a consequence”.