Crude oil futures closed lower on Tuesday (July 25) following reports that the United States was preparing to draw down its SPR in a bid to curb rising prices.
Oil futures also came under pressure as the U.S. consumer confidence index fell for the third straight month on concerns about a slowdown in the economy.
- WTI crude futures were down $1.72, or 1.8%, at $94.98 a barrel.
- BRENT crude futures were down 75 cents, or 0.7%, at $104.40 a barrel.
WTI crude futures fell after the White House released a statement saying the U.S. would draw down an additional 20 million barrels from SPR stocks in an effort to stem the rise in oil prices and ease domestic inflation.
According to the report, the U.S. government has now emptied 125 million barrels of SPR reserves, with nearly 70 million barrels delivered to buyers.
Oil markets also came under pressure as a Conference Board survey showed the U.S. consumer confidence index fell 2.7 points to 95.7 in July, the third consecutive month of declines. Consumers are concerned about inflation, and the U.S. economy is likely to weaken in the second half of the year.
Investors are waiting for the EIA crude oil inventory report today, while analysts at S&P Global Commodity Insights expect U.S. crude oil inventories to fall by 800,000 barrels, gasoline inventories by 1.1 million barrels and distillate inventories by 200,000 barrels.
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Wednesday, July 27, 2022