Crude oil prices fell since Saudi Arabia lowered crude oil prices by $1 per barrel for Asian buyers. This came with the assumption that Saudi Arabia may have overestimated demand for the Asian market.
With this price cut, Saudi Arabia aims to increase its market share for Saudi crude oil in Asia.
However, fuel demand factors in Asia remain under pressure due to the spread of the COVID-19 virus.
Damage from Hurricane Ida is hitting the Gulf of Mexico.
The U.S. Office of Safety and Environmental Affairs reports that more than 84% of crude oil production, or more than 1.5 million barrels of crude oil per day, has been affected. Affected companies were unable to resume production, including about 1.8 million cubic feet of natural gas, or 81%.
Baker Hughes reported that the U.S. crude oil rig count fell by 16 to 396, the largest drop in a year.
Weak U.S. nonfarm payrolls of 235,000 were also a factor pushing oil prices lower. The weak number suggests that fuel demand has not yet returned even before COVID times and the Federal Reserve does not expect to taper bond purchases anytime soon.
Brent crude fell 8.30 p.m. ET by 1.06% to $71.69 per barrel.
WTI crude fell 1.02% to $68.28/barrel.