Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Oil settles down on worries over European banks, U.S. crude reserve

Published 24/03/2023, 12:12 pm
Updated 25/03/2023, 06:23 am
© Reuters. FILE PHOTO: A tug boat pushes an oil barge through New York Harbor in New York City, U.S., May 24, 2022.  REUTERS/Brendan McDermid

© Reuters. FILE PHOTO: A tug boat pushes an oil barge through New York Harbor in New York City, U.S., May 24, 2022. REUTERS/Brendan McDermid

By Laura Sanicola

(Reuters) -Oil prices settled lower on Friday as European banking shares fell and after U.S. Energy Secretary Jennifer Granholm said refilling the country's Strategic Petroleum Reserve (SPR) may take several years, dampening demand prospects.

Brent crude settled down 92 cents, or 1.2%, to $74.99. West Texas Intermediate U.S. crude futures fell 70 cents, or 1%, to $69.26 a barrel.

Both benchmarks rose this week as banking sector turmoil eased. Brent futures rose 2.8% in the week while U.S. crude futures rose 3.8%. Last week, both benchmarks posted their biggest declines in months.

"We're riding along macroeconoic headwinds, and there's a newfound correlation with equities" said John Kilduff, partner at Again Capital LLC in New York.

Banking stocks slid in Europe with Deutsche Bank (ETR:DBKGn) and UBS Group slammed by worries that the worst problems in the sector since the 2008 financial crisis could persist.

U.S. Treasury Secretary Janet Yellen convened an unscheduled meeting of the Financial Stability Oversight Council on Friday morning.

The dollar rose 0.6% against other currencies, which also pressured oil, making crude more expensive to holders of other currencies.

The White House said in October it would buy back oil for the SPR when prices were at or below about $67-$72 per barrel.

On Thursday, Granholm told lawmakers it would be difficult to take advantage of low prices this year to add to stockpiles, which are at their lowest level since 1983 following sales directed by President Joe Biden last year.

Oil drew some support from strong demand expectations from China. Goldman Sachs (NYSE:GS) said commodities demand was surging in the world's biggest oil importer, with oil demand topping 16 million bpd.

© Reuters. FILE PHOTO: A tug boat pushes an oil barge through New York Harbor in New York City, U.S., May 24, 2022.  REUTERS/Brendan McDermid

Russian Deputy Prime Minister Alexander Novak said a previously announced cut of 500,000 barrels per day (bpd) in Russia's oil production would be from an output level of 10.2 million bpd in February, the RIA Novosti news agency reported.

That means Russia aims to produce 9.7 million bpd between March and June, according to Novak, a much smaller output cut than Moscow previously indicated.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.