{"id":6169,"date":"2023-11-02T18:15:18","date_gmt":"2023-11-02T18:15:18","guid":{"rendered":"https:\/\/connectwithfund.com\/investment\/oil-prices-finish-lower-with-concerns-of-an-economic-slowdown-raising-prospects-for-a-supply-surplus\/"},"modified":"2023-11-02T18:15:19","modified_gmt":"2023-11-02T18:15:19","slug":"oil-prices-finish-lower-with-concerns-of-an-economic-slowdown-raising-prospects-for-a-supply-surplus","status":"publish","type":"post","link":"https:\/\/connectwithfund.com\/?p=6169","title":{"rendered":"Oil prices finish lower with concerns of an economic slowdown raising prospects for a supply surplus"},"content":{"rendered":"<div id=\"js-article__body\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0002677683\" role=\"document\">\n<p>Oil futures gave up early gains on Wednesday, extending their losses into a third consecutive session as concerns over an economic slowdown boosted prospects for a surplus in crude supplies.  <\/p>\n<p>Prices turned lower shortly after the Federal Reserve said it would leave its benchmark fed funds rate unchanged, but also left open the option for further interest-rate hikes.  <\/p>\n<div class=\"paywall\">\n<p>A government report showing a second straight weekly rise in U.S. crude supplies also pressured oil prices, as traders continued to monitor developments around the Israel-Hamas war. <\/p>\n<h2>Price action<\/h2>\n<ul class=\"articleList\">\n<li>\n      West Texas Intermediate crude<br \/>\n        CL00,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/209723049\/delayed\" class=\"positive\">+2.80%<\/bg-quote><br \/>\n       for December delivery<br \/>\n        CL.1,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/211629951\/delayed\" class=\"positive\">+2.80%<\/bg-quote><\/p>\n<p>        CLZ23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/209727423\/delayed\" class=\"positive\">+2.80%<\/bg-quote><br \/>\n       fell 58 cents, or 0.7%, to settle at $80.44 a barrel on the New York Mercantile Exchange. It settled at the lowest since Aug. 28, according to Dow Jones Market Data.<\/p>\n<\/li>\n<li>\n      January Brent crude<br \/>\n        BRN00,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/209704782\/delayed\" class=\"positive\">+2.76%<\/bg-quote><\/p>\n<p>        BRNF24,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/209704939\/delayed\" class=\"positive\">+2.76%<\/bg-quote><span>,<\/span><br \/>\n       the global benchmark, declined by 39 cents, or 0.5%, to $84.63 a barrel on ICE Futures Europe.<\/p>\n<\/li>\n<li>\n      December gasoline<br \/>\n        RBZ23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/215376535\/delayed\" class=\"positive\">+2.79%<\/bg-quote><br \/>\n       fell 1.4% to $2.19 a gallon, while December heating oil<br \/>\n        HOZ23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/215376454\/delayed\" class=\"positive\">+2.64%<\/bg-quote><br \/>\n       added 2.8% to $2.96 a gallon.<\/p>\n<\/li>\n<li>\n      Natural gas for December delivery<br \/>\n        NGZ23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210195288\/delayed\" class=\"negative\">-0.94%<\/bg-quote><br \/>\n       settled at $3.49 per million British thermal units, down 2.3% after climbing almost 6.7% on Tuesday. <\/p>\n<\/li>\n<\/ul>\n<h2>Market drivers<\/h2>\n<p>Oil prices dropped toward session lows shortly after the Federal Reserve released statement on monetary policy Wednesday.<\/p>\n<p>The initial drop in oil upon the release of the Fed decision \u201cseemed to be in reaction to the addition of the phrase \u2018tighter financial conditions\u2019 for households and businesses,\u201d Tyler Richey, co-editor at Sevens Report Research told MarketWatch. The added wording \u201cimplies demand is likely to suffer in the near-to-medium term.\u201d<\/p>\n<p>Separately, U.S. data released Wednesday showed a closely watched index that measures U.S. manufacturing activity fell 2.3 points to 46.7 in October, the lowest levels since July, according to the Institute for Supply Management.<\/p>\n<div data-layout=\"inline\n                \" data-layout-mobile=\"\" class=\"\n          media-object\n          type-InsetPullQuote\n            inline\n    scope-web|mobileapps\n  article__inset\n          article__inset--type-InsetPullQuote\n            article__inset--inline\n  \"><\/p>\n<p>          <!-- eventually when we know what this card will be we can change it and leave this one --><\/p>\n<div class=\"wsj-article-pullquote article__inset__pullquote \">\n<p class=\"pullquote-content article__inset__pullquote__quote\">\n        <span class=\"l-qt article__inset__pullquote__mark--left\">\u201c<\/span>\u201cWith longer-term demand expectations fading\u2026there is growing concern the physical markets will tip into a surplus in the months or quarter ahead.\u201d<span class=\"r-qt article__inset__pullquote__mark--right\">\u201d<\/span>\n      <\/p>\n<p>        <small><br \/>\n          <span class=\"inset-author article__inset__pullquote__author\">\u2014 Tyler Richey, Sevens Report Research<\/span><br \/>\n        <\/small><\/p><\/div>\n<\/p><\/div>\n<p>\u201cWith longer-term demand expectations fading with the latest string of disappointing global economic reports we received this week, there is growing concern the physical markets will tip into a surplus in the months or quarter ahead,\u201d said Richey.<\/p>\n<p>Meanwhile, commodity analysts at Goldman Sachs said in a Wednesday note that the market for crude will continue to tighten, and backed up their forecast for Brent to hit $100 a barrel by June.<\/p>\n<p>They said that spare capacity, however, meant that Brent was unlikely to \u201csustainably overshoot\u201d $105 a barrel in 2024, which is the top end of their expected $80-to-$105 a barrel range for OPEC sweet crude spot prices.<\/p>\n<p>The market \u201cmay become very tight in a more distant future,\u201d they said, but \u201cproductivity and oil-demand trends will be critical too.\u201d<\/p>\n<p><strong>Also see:<\/strong> Natural-gas prices surge 22% in October as traders look to winter heating demand<\/p>\n<p>WTI futures based on the front-month contract finished Tuesday at their lowest since Aug. 28, down 10.8% for the month, according to Dow Jones Market Data. Brent broke a streak of four straight monthly gains, falling 8.3% in October.<\/p>\n<p><strong>Read<\/strong> Israel-Hamas war has potential to fuel oil-price shock that can disrupt food security: World Bank<\/p>\n<p>Investors have \u201cshrugged off risks from the Middle East conflict and instead remained focused on fears of weaker global demand,\u201d said Rob Haworth, senior investment strategist at U.S. Bank Asset Management.<\/p>\n<h2>Supply data<\/h2>\n<p>On Wednesday, the Energy Information Administration reported that U.S. commercial crude inventories climbed by 800,000 barrels for the week ended Oct. 27. <\/p>\n<p>The increase was the second in a row reported by the government agency, and came in close to some market expectations. <\/p>\n<p>On average, analysts polled by S&amp;P Global Commodity Insights expected the report to show a rise of 870,000 barrels. Late Tuesday, the American Petroleum Institute, a trade group, reported a 1.3 million barrel rise in last week\u2019s crude-oil inventories, according to a source citing data. <\/p>\n<p>The EIA report revealed a supply increase of 100,000 barrels for gasoline, while distillate stockpiles declined by 800,000 barrels. Analysts forecast decreases of 1.3 million barrels for gasoline and 1.7 million barrels for distillates. <\/p>\n<p>Crude stocks at the Cushing, Okla., Nymex delivery hub rose by 300,000 barrels for the week, the EIA said. <\/p>\n<\/p><\/div>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.marketwatch.com\/story\/oil-bounces-ahead-of-fed-meeting-while-traders-monitor-israel-hamas-war-developments-ccaecd4c?mod=investing\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Oil futures gave up early gains on Wednesday, extending their losses into a third consecutive session as concerns over an economic slowdown boosted prospects for a surplus in crude supplies. Prices turned lower shortly after the Federal Reserve said it would leave its benchmark fed funds rate unchanged, but also left open the option for further interest-rate hikes. A government report showing a second straight weekly rise in U.S. crude supplies also pressured oil prices, as traders continued to monitor developments around the Israel-Hamas war. Price action West Texas Intermediate crude CL00, +2.80% for December delivery CL.1, +2.80% CLZ23, +2.80%<\/p>\n","protected":false},"author":1,"featured_media":2896,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[40],"tags":[],"class_list":["post-6169","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investment"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Oil prices finish lower with concerns of an economic slowdown raising prospects for a supply surplus | ConnectWithFund<\/title>\n<meta name=\"description\" content=\"Oil futures gave up early gains on Wednesday, extending their losses into a third consecutive session as concerns over an economic slowdown boosted\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, 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