Oil prices fall 0.3% as China plans to withdraw from its stocks

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Oil prices fell by more than 0.2% in overnight trading on Thursday, as China announced that it will take an unprecedented step by drawing from government crude oil reserves to ease pressure on domestic refiners, which will reduce demand from elsewhere.

US crude fell 0.29% to $69.1 a barrel, while Brent crude fell 0.33% to $72.36 a barrel.The US Energy Information Administration said on Thursday that crude, gasoline and distillate inventories in the United States fell last week.

Crude stocks fell 1.5 million barrels in the week ending September 3 to 423.9 million barrels, compared with analysts’ expectations in a Reuters poll for a 4.6 million barrel decline.

Crude stocks at the delivery center in Cushing, Oklahoma, rose 1.9 million barrels last week, according to the Energy Information Administration.The administration said that crude consumption in refineries fell by 1.6 million barrels per day last week. Refinery operating rates fell 9.4 percentage points over the week.

The Energy Information Administration reported that gasoline stocks fell 7.2 million barrels in the week to 220 million barrels, compared with analysts’ expectations in a Reuters poll indicating a decline of 3.4 million barrels.

Energy Information Administration data showed distillate stocks, which include diesel and heating oil, fell 3.1 million barrels to 133.6 million barrels, versus expectations for a 2.6 million barrel decline.

The administration said that net imports of US crude oil last week rose by 168,000 barrels per day.

In addition, Royal Dutch Shell said today, Thursday, that it had declared force majeure in some contracts due to the damage to its marine facilities in the Gulf of Mexico after Hurricane Ida.

Force majeure is a legal provision that companies use during unforeseen events such as hurricanes and fires when they cannot meet contractual obligations such as oil delivery.





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