World crude oil prices cut by 500,000 per barrel

Global crude oil prices traded positively this week as the prospect of deeper-than-expected Russian supply cuts largely offset concerns that rising interest rates would dampen demand this year.

According to information obtained by us through the investing.com website, recently crude oil prices marked a strong recovery from previous losses. Reuters reported that Russia plans to cut up to 25% of oil exports from its western ports in March, around more than the previous 500,000 barrels / day cut. Brent oil futures rose 0.3% to $ 82.75 per barrel, while WTI crude oil futures jumped 0.8% to $ 75.97 per barrel. Both contracts traded and each fell less than 0.5% for the week, after mostly paring their early losses. The prospect of Russian oil supply cuts has contributed to the market looking past a larger-than-expected increase in U.S. crude inventories, which grew for a ninth straight week amid slowing consumption in the country. Concerns about a further slowdown in oil demand could certainly weigh on oil prices this week, especially amid a slew of hawkish signals and economic data. Signs of resilience in the U.S. jobs market, coupled with strong inflation readings for January and the fourth quarter (Q4), supported the Fed's hawkish stance. A stronger dollar also weighed on crude oil markets, as a stronger greenback makes oil more expensive for international buyers.

The focus now is on the private CPI reading, the Fed’s preferred inflation measure, and further cues on monetary policy. The reading is expected to reaffirm that inflation remained elevated through January. US GDP data for Q4 was revised lower on Thursday, suggesting that interest rate hikes may have had a more profound impact on the US economy so far than previously expected. Meanwhile, slowing growth bodes ill for crude oil demand, and could also reduce the economic headroom the Fed has to raise prices. High inflation readings from Singapore, the Euro area and Japan in recent weeks have also raised concerns about the tightness of global monetary conditions. Oil prices are trading lower for the year amid fears of a further global recession. However, oil prices are still bullish and are holding out for a recovery in supply demand from China after the world’s largest oil importer eased most of its anti-Covid measures earlier this year. However, early economic indicators from the country suggest that much of the economy is still struggling in the wake of the pandemic.