Oil prices closed slightly higher on Tuesday (April 4) as concerns over weak economic data from China and the United States weighed on investor sentiment, overshadowing positive news from the Organization of Petroleum Exporting Countries (OPEC) and its allies, known as OPEC Plus, who announced a reduction in oil production by over 1 million barrels per day until the end of 2023.
WTI crude futures rose 29 cents, or 0.4%, to settle at $80.71 a barrel, while Brent crude futures rose 1 cent to settle at $84.94 a barrel.
Investors are becoming increasingly worried about the potential for an economic recession, following the release of the US Department of Labor’s survey of job openings and labor turnover rates (JOLTS) for February. The report revealed that job openings, which serve as a gauge of labor demand, fell by 632,000 to a seasonally adjusted 9.9 million in February, marking the lowest level since May 2021 and the first time it has dipped below 10 million jobs since 2021, falling short of analysts’ expectations of 10.4 million jobs.
Furthermore, China’s March manufacturing Purchasing Managers’ Index (PMI) also showed a decline, dropping to 50 from 51.6 in February, indicating weakened global demand.
These weak economic data from both the US and China have overshadowed the positive news from OPEC Plus, which announced a significant cut in oil production by 1.16 million barrels per day through the end of 2023. OPEC Plus’ decision was aimed at supporting oil prices and stabilizing the market, with the expectation that it could push Brent crude prices up to $100 per barrel by the end of the year.
Investors are now eagerly awaiting the release of the US Energy Information Administration (EIA) crude inventories report, with analysts in a S&P Global Commodity Insights poll anticipating a decrease in US crude inventories. The poll suggests that crude inventories may have fallen by 7.5 million barrels, while gasoline stocks may have dropped by 1.3 million barrels and distillate stocks by 140,000 barrels.
With concerns over a potential economic recession and its impact on oil demand, combined with ongoing geopolitical uncertainties and supply dynamics, the oil market remains volatile and closely monitored by investors and industry experts alike. The outcome of the EIA crude inventories report could provide further insights into the future direction of oil prices in the coming days. Overall, market participants will continue to closely monitor economic indicators and global events that may impact oil prices and market sentiment in the near term.
The Spot Market is Open
Wednesday, April 5,2023
| Energy Updated at | USD Price | Change | %Chnage |
| Crude Oil 10.50 | 81.10 | +0.39 | +0.48% |