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Oil Prices Drops Again

Oil costs rebounded around Wednesday after unbalanced data on weekly resources from the EIA. Benchmark U.S. crude traded around $95 per barrel while Brent, the global benchmark, stayed around $100. reserves showed an unexpected gain of 4.3 million vs. an anticipated draw of 1.4 million. Distillate production also increased by 0.33 million barrels.

Reuters also reported that Prices had been forced by concerns of slowing China’s demand, as the second-largest Oil consumer imposes stringent measures to contain the spread of COVID-19. Early last week, WTI hit a high of $130.50 per barrel, while Brent traded as high as $139.26 per barrel. Traders were concerned that Russia’s energy exports might be hindered; therefore, prices rose. So far, the United States and Canada have prohibited Russian energy shipments, while the United Kingdom has stated that it will progressively stop Russian imports.

The latest moves to curb the spread of Covid-19 are also having an impact on prices. The nation is the world’s largest Oil importer, so any slowdown in demand will hit prices. A deal with Iran could also add new barrels of to the market. Russia’s Foreign Minister Sergey Lavrov is in favor of resuming the deal.

In recent sessions, Oil has been extremely volatile, swinging back and forth between gains and losses with every new geopolitical incident. The rise in Oil costs has driven gas prices to all-time highs. According to AAA, the national average for a gallon of gas touched $4.331 on Friday, the highest level ever. The figure hasn’t been adjusted for inflation. The prices have dipped marginally. The average for a gallon of gas was $4.316 on Tuesday.

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