Oil prices fell a little on Tuesday, continuing a downward trend for the second day in a row after a sharp rise last week. Brent crude was down by 8 cents, reaching $76.22 a barrel, while U.S. West Texas Intermediate (WTI) crude saw a 15-cent drop, landing at $73.42. This decline followed five days of gains, where prices hit their highest since October because there were hopes for more money to help China’s struggling economy.
Analyst Priyanka Sachdeva noted that this drop might be just a natural adjustment. She mentioned that weaker economic news from the U.S. and Germany is making traders less optimistic. Another reason prices are going down is the increase in oil supply from countries outside OPEC, combined with lower demand from China.
Market watchers are also looking forward to important data like the U.S. job numbers being released on Friday, which will give clues about interest rates and how much oil the U.S. will need.
A report from ING analysts suggested that while the prices had risen, they might struggle to continue going up. However, worries about oil supplies from Russia and Iran due to sanctions are providing some support to prices.
Interestingly, demand for Middle Eastern oil appears to be increasing, shown by Saudi Arabia raising its oil prices for Asia for the first time in three months. In good news for traders, the U.S. Commodity Futures Trading Commission reported that money managers increased their positions in U.S. crude futures and options.
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