Oil steadied after its first drop in three sessions as lagging US diesel demand overshadowed a disruption to shipments from Turkey.
(Bloomberg) — Oil steadied after its first drop in three sessions as lagging US diesel demand overshadowed a disruption to shipments from Turkey.
West Texas Intermediate futures traded near $73 a barrel after closing 0.3% lower on Wednesday. US government data showed crude inventories shrunk the most this year last week but demand for distillates continued to languish at the lowest seasonal level since 2016, a sign of a lackluster economy.
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Oil rallied at the start of this week after a dispute between Iraq, Turkey and Kurdish authorities halted around 400,000 barrels a day of exports from the Ceyhan port. However, WTI is on track for its fifth monthly decline due to the banking crisis, recessionary concerns and resilient Russian output.
“Market sentiment is likely to guide oil prices in days ahead,” said Soni Kumari, a commodity strategist with Australia and New Zealand Banking Group Ltd. in Bengaluru. Still, “we believe the focus will be shifting to demand revival in the US and strong demand in Asia.”
Most market watchers are still betting on China’s recovery underpinning a price rally later this year, and comments from two of the nation’s oil majors painted an optimistic outlook. PetroChina and Cnooc Ltd. said a rebounding domestic economy can help cushion the impact of slower global growth.
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