Crude oil futures closed lower on Tuesday (June 14) as investors worried that the U.S. Federal Reserve’s tendency to raise interest rates more sharply could hurt economic activity and oil demand.
- WTI crude futures were down $2, or 1.65%, at $118.93 a barrel.
- BRENT crude futures were down $1.10, or 0.9%, at $121.17 a barrel.
The Fed Committee will announce the results of its meeting today (US time). Most analysts expect the Fed to raise interest rates by 0.75% at its meeting, after the consumer price index (CPI), rose 8.6% in May from a year earlier. This is the highest level in more than 40 years.
Crude oil futures have also come under pressure from reports that Senate Finance Committee Chairman Ron Weiden has proposed a legislation to impose a surtax on oil companies’ excess profits. The tax would be levied at a rate of 21% on oil and gas companies with annual revenues of more than $1 billion.
Investors are looking ahead to the release of crude oil inventory figures by the EIA. Analysts expect that U.S. crude oil inventories fell by 1.4 million barrels in the week ended June 10.
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Wednesday, June 15, 2022
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