Oil Price Drop Amid Weak Manufacturing Data Despite Sharp U.S. Crude Stock Decline
Oil price drop in Asian trading due to weak manufacturing data despite a large drop in U.S. crude stocks. Attention turned to Jerome Powell’s speech for interest rate hints. Brent crude slipped 0.3% to $82.94, U.S. West Texas Intermediate dropped 0.4% to $78.58, with troubling global manufacturing data and slower U.S. growth.
Oil Prices Drop in Asian Trading Amid Weak Manufacturing Data and Larger-than-Expected U.S. Crude Stock Drop; Investors Eye Jerome Powell’s Speech for Rate Insights
Oil price drop in early Asian trading on Thursday due to weak manufacturing data from major economies, despite a bigger-than-expected drop in U.S. crude stocks. According to WHTC, investors were also focused on a speech by Federal Reserve Chair Jerome Powell at a central bank event in Wyoming, looking for clues about future interest rates.
Brent crude, the global benchmark, went down 0.3%, reaching $82.94 per barrel, while U.S. West Texas Intermediate oil price drop from 0.4% to $78.58 per barrel. According to the report, recent manufacturing data showed troubling signs for the global economy caused by the oil price drop. Japan’s factory activity shrank for the third month, Eurozone business activity, especially in Germany, declined more than anticipated, and the UK’s economy seemed headed for recession. Business growth in the U.S. also slowed down, nearing stagnation.
Oil Price Drop Fuels Discussion at Jackson Hole, Iran’s Output Goals, and Unexpected US Crude Inventory Plunge
At the same time, attention turned to the Jackson Hole symposium where central bank officials discussed the potential for prolonged higher interest rates, even as inflation eased.
On the supply side, Iran aimed to increase crude oil output despite ongoing U.S. sanctions, and there were indications that the U.S. might ease sanctions on Venezuela’s oil sector if the country made progress toward a fair presidential election, as reported in XM.
Surprisingly, U.S. crude inventories plummeted by 6.1 million barrels in the week leading up to August 18, a much larger oil price drop than the 2.8 million barrels predicted by experts in a Reuters poll.