Crude prices declined on Wednesday, after Syria agreed to give up its stockpiles of chemical weapons, easing worries over the Middle East exports. On Tuesday, the US crude inventories data showed a higher drop that analysts predicted.
The West Texas Intermediate October deliveries dropped 0.27% lower to $107.10 per barrel on New York’s Nymex as of 5:05am GM, while the European benchmark Brent crude advanced 0.24% higher to $111.52. Worries over the possibility of the US military intervening in Syria pushed WTI crude $112 higher a barrel at the beginning of September.
Syria have accepted Russia’s proposal to give up chemical weapons, which would possibly avert a US military strike in Syria. The US senate is expected to vote on a resolution for a military strike in Syria by the end of the week.
Investors worries that if any military intervention in the Syria occurs, it could spark conflicts in the neighboring oil-rich countries such as Iraq and Saudi Arabia, threatening the global oil supply chains within the region.
The world’s leading oil consumer’s crude supplies posted a drop of 2.9 million barrels last week, surpassing analysts’ prediction of a 1 million barrel fall, according to reports from the American Petroleum Institute.
Gasoline stockpiles rose by 195,000 barrels, while distillate supplies increased by 807,000 barrels.
Report from the US Department of Energy is expected to be released later in the day.
Investors are mainly focused on the Chinese economic fundamentals as China remains the second-largest oil consuming country in the world.
The country’s industrial production increased by 10.4% in August, the National Bureau of Statistics reported on Tuesday. The industrial production grew from the previous month’s 9.7% reading in production levels.
The growth rate of the Chinese industrial production reached the highest in 17 months in August.
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