Impasse on US debt | Oil ends down

(New York) Oil prices fell back on Wednesday as the impasse over the U.S. debt ceiling begins to worry markets as U.S. crude reserves rose, which usually doesn’t help either. course.



The barrel of Brent from the North Sea, for delivery in July, dropped 1.33% to 76.41 dollars.

Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery in June, dropped 1.56% to 72.56 dollars.

Oil prices were already retreating before the U.S. Energy Information Agency (EIA) reported an unexpected surge in U.S. commercial crude inventories last week.

They thus increased by 3 million barrels, whereas the median forecast by analysts was counting on a reduction of 2.5 million barrels.

However, this figure initially masks government recourse to strategic oil reserves (SPR) from which 2.9 million barrels were drawn, which offsets the rise in commercial stocks.

It also obscures the fact that much more gasoline was consumed last week, as inventories fell by 3.2 million barrels due to higher demand and the start of the car travel season in the States. -United.

For Andy Lipow of Lipow Oil Associates, “the inventory numbers were actually quite constructive” for the market as US gasoline and distillates consumption increased.

According to him, it is rather the showdown over the American debt ceiling that is beginning to worry brokers.

“The market is actually reacting to the inability of Congress to come to an agreement to raise the debt ceiling,” he said.

This prevents the United States from borrowing more to honor its financial commitments and it could lead to a default of the world’s largest economy, from 1er June when their cash runs dry.

If the other financial markets so far do not yet focus on this political impasse, “the oil market is worried about the possible consequences of a default which would be associated with a slowdown in demand, until this be resolved by an agreement of the 11e hour,” said Andy Lipow.

The consumer price index (CPI) for April in the United States also showed a very slight deceleration in the rise in prices to 4.9% over one year but started to rise again over the month (+0 .4% in April against 0.1% in March).

“The process of disinflation stopped in the United States in April, if we look at the monthly data, but there are reasons for cautious optimism,” said Edoardo Campanella, economist at UniCredit.


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