Oil prices slipped more than $1 on Wednesday as likely higher US commercial inventories weighed, while weaker economic data from China and dimmed prospects of interest rate cuts stoked worries about global demand, reports Reuters.
Brent futures for June were down $1.21, or 1.3 per cent, to $88.81 a barrel at 1330 GMT, while US crude futures for May were down $1.11, or 1.3 per cent, to $84.25 a barrel. Both were on track for their biggest fall since March 20 if losses hold.
Oil prices have softened this week as economic headwinds curb gains from geopolitical tensions, with markets eyeing how Israel might respond to Iran's weekend attack.
Analysts do not expect Iran's unprecedented missile and drone strike on Israel to prompt dramatic sanctions from the United States on Iran's oil exports.
"Oil prices go about their business of unwinding some of the war premium that has been priced-in," said John Evans at oil broker PVM, adding that they also faced "a setback in interest rate cut hopes".
Top US Federal Reserve officials including Chair Jerome Powell backed away on Tuesday from providing any guidance on when interest rates may be cut, dashing investors' hopes for meaningful reductions in borrowing costs this year.
Britain's inflation rate slowed by less than expected in March, signalling that a first rate cut by the Bank of England could also be further off than previously thought.
However, inflation slowed across the euro zone last month, reinforcing expectations for a European Central Bank rate cut in June.
"A build-up in US crude inventories overnight and a mixed set of economic data out of China also offered some reservations, alongside near-term overbought technicals which prompts some profit-taking," said IG market strategist Yeap Jun Rong.
In China, the world's biggest oil importer, the economy grew faster than expected in the first quarter, but several other indicators showed that demand at home remains frail.
© 2024 - All Rights with The Financial Express
