Oil prices fell in early Asian trade on Thursday, heading for a sixth day of declines, following a lower-than-expected draw on United States stockpiles and amid worries Britain might leave the European Union.
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Energy traders also digested a lower than expected USA crude inventory draw last week when us commercial crude oil inventories decreased by 0.9 million barrels for the week ending on June 10.
He added: “The market is now starting to suggest that once the disruptions are behind us, surplus will re-appear and the rally that we have seen in the prices will evaporate”.
New polls released Tuesday showed the leave campaign is gaining over the “In” camp.
Brent crude futures’ front-month LCOc1 saw a fall of 86 cents to $48.97 per barrel, while the front-month of U.S. crude’s West Texas Intermediate (WTI) futures CLc1 dropped by 48 cents to reach $48.01 a barrel, reported Reuters.
The dollar hit a two-week high against a basket of currencies as global markets feared economic turmoil if Britain votes to leave the European Union.
On the New York Mercantile Exchange, WTI crude for July delivery traded between $46.16 and $47.75 a barrel before closing at $46.20, down 1.78 or 3.71% on the session.
The US Federal Reserve had signalled on Wednesday that it still plans two US rate hikes this year despite slower growth expectations, also hitting the oil market. A stronger dollar makes crude, priced in the USA currency, costlier in the euro and others.
USA crude stockpiles fell by 933,000 barrels last week, the government-run Energy Information Administration (EIA) said, versus market expectations for 2.3 million-barrel draws.
The Department of Energy said commercial inventories fell by 900,000 barrels in the week ending June 10, far fewer than the 2.33 million predicted in a Bloomberg survey, suggesting demand is easing in the world’s top oil consumer. U.S. Treasury yields fell to their lowest level in four years.
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Apache Corp. APA, -0.42%, for example, based its budget this year on USA oil prices of $35 a barrel, so it is “not unreasonable” to think the company could add five rigs in the Permian basin with oil now near $50, analysts at energy-focused investment bank Simmons & Co.
