Oil prices are falling on Thursday after a strong rise in the previous session.
The cost of July futures for Brent on London’s ICE Futures Exchange stood at $76.73 a barrel by 8:15 a.m. Thursday, down $0.23 (0.3%) from the close of the previous session. Those contracts rose $2.05 (2.7%) to $76.96 a barrel on Wednesday.
The price of WTI futures for June oil fell by $0.23 (0.32%) to $72.6 per barrel at electronic auctions of New York Mercantile Exchange (NYMEX) by that time. The contract value grew by $1.97 (2.8%) to $72.83 per barrel at the end of previous session.
Support to the market on Wednesday was given by the statements of U.S. President Joe Biden, who again expressed optimism about negotiations on the state debt ceiling issue, notes Market Watch.
“I am confident that we will have an agreement and the U.S. will not default,” Biden said while speaking at the White House.
“Investors’ hopes that the U.S. government debt limit problem will be resolved soon are increasing,” notes StoneX analyst Fawad Razakzada. – Biden’s statement led to an increase in appetite for risk in world markets, including oil”.
However, the market was constrained by the U.S. Department of Energy data which showed an increase in oil inventories in the country for the second week in a row.
Last week commercial inventories in the U.S. rose by 5.04 million barrels, a record high over the past 12 weeks. Analysts had expected a decline of 2 million barrels.
Gasoline inventories declined by 1.38 million barrels, while distillate stocks increased by 80,000 barrels. Experts forecasted reduction by 2 million barrels and 1.5 million barrels respectively.
