Crude Oil Prices Move Sharply Lower Ahead of Supply Data

Investing.com – Crude oil prices moved sharply lower on Wednesday, weighed by the U.S. dollar’s recent rebound and as traders grew more cautious ahead of this week’s U.S. supply data.

The U.S. West Texas Intermediate April contract was down 70 cents or about 1.13% at $61.09 a barrel by 03:30 a.m. ET (07:30 GMT), the lowest since February 15.

Elsewhere, for April delivery on the ICE Futures Exchange in London declined 73 cents or about 1.09% to $64.55 a barrel, the lowest since February 16.

The U.S. contract was boosted on Tuesday a result of reduced flows from Canada’s Keystone pipeline, which has been operating below capacity since late last year due to a leak.

Oil prices were also supported by the risk of supply disruptions in the Middle East after Israel’s Prime Minister Benjamin Netanyahu that Israel could act against Iran itself, not just its allies in the Middle East, following border incidents in Syria.

But traders grew more cautious ahead of this week’s U.S. inventories reports. The American Petroleum Institute was set to publish its on U.S. oil supplies later Wednesday, while by the U.S. Energy Information Administration was expected on Thursday.

The reports come out one day later than usual due to Monday’s President’s Day holiday.

Fears that rising U.S. output could dampen global efforts to rid the market of excess supplies have systematically limited oil prices’ gains recently.

The Organization of the Petroleum Exporting Countries (OPEC), along with some non-OPEC members led by Russia, agreed in December to extend oil output cuts until the end of 2018.

The deal to cut oil output by 1.8 million barrels a day (bpd) was adopted last winter by OPEC, Russia and nine other global producers. The agreement was due to end in March 2018, having already been extended once.

Elsewhere, retreated 0.72% to $1.733 a gallon, while declined 0.84% to $2.593 per million British thermal units.

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