Oil prices fell on Tuesday, affected by inflation in crude supplies and weak demand for fuel due to the Corona virus pandemic, while investors are also increasingly warning about expectations that the world’s largest producers will soon agree to supply cuts.
US benchmark West Texas Intermediate crude futures ended the trading session low, $ 2.45, or 9.4 percent, to settle at $ 23.63 a barrel.
Brent crude futures closed down $ 1.18, or 3.6 percent, to $ 31.87 a barrel.
The pace of acceleration accelerated before weekly reports on US oil stocks, and analysts expect an increase of 9.3 million barrels in crude oil stocks and a jump in stocks of refined products.
The world’s largest crude suppliers, including Saudi Arabia and Russia, plan to meet Thursday to discuss production cuts, but sources told Reuters that a few ministers said this would only happen if the United States joined the cuts.
“The market is indicating that it wants more assurance about whether the Russians and the Saudis will enter into an agreement to restrict the supply,” said Jane McGillian, deputy head of market research at Tradition Energy in Stamford.
The US Energy Information Administration said on Tuesday that crude oil production in the United States is expected to drop by 470,000 bpd in 2020, while demand is expected to drop by about 1.3 million bpd.
It added that America’s gasoline consumption will reach some of the lowest levels in 20 years in the second quarter of 2020.