– On Monday, oil prices declined, giving back some of the large gains made the previous week as focus shifted back to the short-term demand forecast ahead of important U.S. inflation data.
Futures were trading 0.7% lower at $79.14 a barrel by 09:15 ET (14:15 GMT), while the contract was down 0.8% to $85.69 a barrel.
The newest statistics from the United States will be released on Tuesday, and this information may offer more hints about how high interest rates may need to rise this year.
Since the United States economy is the world’s greatest user of crude oil, rising inflation levels will ensure that the Federal Reserve maintains raising interest rates.
However, these declines pale in comparison to the nearly 8% gains made last week, especially in light of Russia’s announcement that it will reduce oil production in March by 500,000 barrels per day, or around 5% of January’s output.
This notion appeared to be supported by data provided by Bloomberg, which showed that overall flows of Russian oil decreased by 562,000 barrels per day, or 16%, in the seven days leading up to February 10 and reached a six-week low.
Given that we always anticipated that Russia would have to decrease supplies as a result of the EU prohibition on oil and refined goods, these cuts, according to ING, “do not affect our outlook on the market.”
However, early indications show that Russia’s allies in the oil coalition won’t increase production to make up for the drop declared by Moscow. This announcement will likely focus attention on the output levels from the Organization of Petroleum Exporting Countries.
On Tuesday, OPEC will publish its, which will contain the most recent market outlook and production figures for January.