Oil prices were little changed on Wednesday after falling for three days as worries about slowing demand on recession expectations in Europe offset worries about Middle East supply disruptions stemming from the Israel-Hamas conflict in Gaza.
Brent crude futures were up 6 cents to $88.13 a barrel by 03:45 GMT, while West Texas Intermediate (WTI) crude futures were up 1 cent to $83.75 a barrel.
Eurozone business activity data suffered a surprise decline this month; This suggests that the bloc could fall into recession and have a negative impact on the oil demand outlook. Data show that oil refineries in the region are processing less crude oil than a year ago amid weak economic growth.
It is simply not true to say that the geopolitical risk premium associated with the Israel-Hamas conflict has dissipated in a meaningful and lasting way.
Crude prices may find some support after the top parliamentary body of China, the world’s biggest oil importer, approved a bill to issue 1 trillion yuan ($137 billion) of government bonds and allow local governments to issue new debt from their 2024 quotas.
The decrease in crude oil stocks in the United States, the world’s largest oil consumer, also supported prices. US inventories decreased by about 2.7 million barrels in the week ending Oct. 20, according to market sources, according to data released by the American Petroleum Institute (API) on Tuesday. This did not confirm the predictions of analysts, who estimated that crude stocks rose by about 200,000 barrels on average for the week.
Gasoline stocks fell by 4.2 million barrels, while distillate stocks fell by about 2.3 million barrels, according to API data.
U.S. government EIA data on inventories will be released later Wednesday.