Oil prices down amid expectations that US production will ‎reach its peak

Oil prices fell on Wednesday amid indications that the United States, the world’s largest oil producer, had reached peak production, overshadowing the impact of positive signals regarding demand for crude from China, the largest oil consumer.

By 0949 GMT, Brent crude futures fell 34 cents to $82.13 a barrel, while US West Texas Intermediate crude fell 40 cents to $77.86.

According to Reuters, economic activity rebounded in China in October, with industrial production growing at a faster pace and retail sales growth exceeding expectations, which is a positive indicator for the second largest economy in the world.

The International Energy Agency joined the Organization of the Petroleum Exporting Countries and its allies (OPEC+) in raising oil demand growth expectations for this year, despite expectations of a slowdown in economic growth in many major countries.

“With China being the scapegoat for much of the world’s industrial demand shortfall, this ray of light should help oil advance, but so far hesitation is winning,” John Evans of oil brokerage PVM said in a note. .

Evans added that downward pressure on oil prices may come from the supply side, as “the United States is likely to be at peak crude oil production,” while the delayed release of oil data from the world’s largest producer makes the investment situation more uncertain.

The US Energy Information Administration will issue its first report on oil inventories in two weeks on Wednesday. It did not issue its report last week due to a systems update

The Financial Times reported today that Denmark will be tasked with inspecting and possibly preventing Russian oil tankers from sailing through its waters under new European Union plans, as the West explores more ways to impose a ceiling on the price of Moscow crude.

However, how Denmark implements this remains to be seen

Expectations that the Federal Reserve (US Central) will cut interest rates next spring led to the dollar falling to its lowest level in two and a half months against a basket of major currencies. The dollar’s decline could boost demand for oil by making crude cheaper for buyers using other currencies.

The British inflation rate also slowed in October, to a greater extent than expected, which strengthened expectations of the end of the Bank of England’s interest rate raising cycle, with the Federal Reserve and the European Central Bank seemingly reaching the peak of interest rates.