Crude oil prices slipped Wednesday after US President Donald Trump postponed the long-awaited stimulus package for the coronavirus pandemic and with a greater-than-expected rise in US crude inventories.
International benchmark Brent crude was trading at $42.18 per barrel at 0628 GMT for a 1.10% decrease after closing Tuesday at $42.65 a barrel.
American benchmark West Texas Intermediate (WTI) was at $40.11 a barrel at the same time for a 1.38% drop after ending the previous session at $40.67 per barrel.
After starting the week on an optimistic note following news of US President Donald Trump's discharge from the hospital where he was receiving treatment for the novel coronavirus, oil prices then started to decline after Trump halted negotiations to provide a much-needed stimulus package for the US economy until after the presidential election.
Late Wednesday, the American Petroleum Institute (API) announced its estimate of a rise of 951,000 barrels in US crude oil inventories relative to the market expectation of a 400,000-barrel rise.
If crude stocks increase in line with the API’s expectations, it signals that crude demand is falling in the US, the world's largest oil consumer, to push prices down further.
The ongoing strike in Norway following a breakdown of wage talks between the employer organization, Norwegian Oil and Gas Association and the Lederne trade union, however, suppressed the downturn in prices as the strike may cut production on the Norwegian Continental Shelf by 8% or nearly 330,000 barrels of oil equivalent per day.
Further drops in prices were limited with the forecast storm, Hurricane Delta, in the Gulf of Mexico. Hurricane Delta has now intensified to Category 2 and in anticipation of the extreme danger it is set to bring to the area, petroleum firms including Royal Dutch Shell and Equinor evacuated workers on their offshore oil rigs.
By Sibel Morrow