Prices for the WTI Oil dropped for the ninth time in the past ten days as investors’ worries over the US first government shutdown in 17 years will slowdown the growth rate of the economy and the demand for crude.
Futures for WTI Oil dropped 0.6% lower in New York and was on the edge of its lowest close in three months. The US began its shutdown on Tuesday after lawmakers failed to agree the federal budget by the deadline on Monday midnight. While crude stockpiles rose by 4.55 million barrels last week, the American Petroleum Institute confirmed. Data expected from the Energy Information Administration is predicted to show a rise in supplies by 2.5 million, according to Bloomberg News survey.
“The picture for oil is not good, it remains bearish,” said Jonathan Barratt, the chief executive officer of Barratt’s Bulletin in Sydney. “Fiscal issues in the U.S. continue to be a headline, while inventory levels are increasing. Oil remains under pressure.”
WTI November delivery dropped 61 cents lower to $101.43 a barrel on the New York Mercantile Exchange. The volume of futures traded was approximately 62% below the 100-level.
While Brent November delivery declined 50 cents to $107.44 a barrel, on the London ICE Futures Europe exchange. The European benchmark crude Brent was at $5.99 to WTI.
The US Congress failed to finalize an agreement over the country’s budget for the fiscal year which began yesterday, causing its first government shutdown in 17 years and could affect almost 800,000 federal employees.
The US announced its final extraordinary measures to avoid exceeding the borrowing limit and its ability to borrow will end on October 17, Jacob J. Lew, Treasury Secretary announced.
American Petroleum Institute confirmed that the US gasoline supplies boosted by 3.26 million barrels last week. While the EIA report is expected to show a fall in inventories by 700,000 barrels, according to the Bloomberg survey.
Meanwhile distillate stockpiles (including heating oil and diesel), dropped by 1.57 million barrels, the API said.
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