Oil prices fell for a second session on Thursday due to the Federal Reserve’s expected interest rate cut, demand concerns signaled by the US economy, and concerns about oversupply in the market.
Brent crude futures fell 13 cents, or 0.19%, to $67.82 a barrel by 04:17 GMT. WTI crude futures fell 18 cents, or 0.28%, to $63.87.
The Fed cut its policy rate by a quarter point on Wednesday. In response to signs of weakness in the labor market, it said it would steadily reduce borrowing costs for the rest of the year.
Lower borrowing costs generally increase demand for oil and boost prices.
The latest rate cut did not have a significant impact; hints of two more rate cuts this year had already been priced in.
The Fed’s signal that further interest rate cuts are coming suggests that policymakers assess the economic risk from unemployment as greater than inflation.
Persistent oversupply and low fuel demand in the US, the world’s largest oil consumer, have also negatively impacted the market.
US crude oil inventories fell sharply last week, with net imports falling to a record low while exports rose to their highest level in nearly two years.
The increase in distillate oil inventories reached 4 million barrels, contrary to market expectations of a 1 million barrel increase. This fueled demand concerns in the world’s largest oil consumer and pressured prices.