Oil prices fall in the second session, losses increase as demand concerns outweigh supply constraints
Oil prices fell for the second time on Thursday as demand concerns outweighed global supply after US government data showed low gasoline consumption during the peak summer driving season.
Brent crude futures were down 33 cents, or 0.3%, to $106.59 a barrel as of 0618 GMT, after falling 0.4% in the previous session. West Texas Intermediate (WTI) crude futures fell 48 cents, or 0.5%, to $99.40 a barrel, after falling 1.9% on Wednesday.
Oil prices, became volatile after Russia's invasion of Ukraine, as global supplies need to tighten amid the loss of Russian products due to sanctions and the fears that the recession could weaken energy demand.
U.S. gasoline inventories increased by 3.5 million barrels last week, far exceeding analysts' forecasts for a 71,000-bp increase, government data released Wednesday showed.
Gasoline demand is declining despite as the driving season is supposed to be at its peakiest. The data showed that output from gasoline, an indicator of demand, was about 8.5 million barrels per day, or about 7.6% lower than at the same time a year ago.
Despite lower refinery operation throughout the week, rising gasoline inventories indicate that US inventory data is relatively low. The seasonal low demand for gasoline eventually indicates the effect of high prices on demand.
Meanwhile, concerns about Libya's supply eased. The National Petroleum Corporation (NOC) announced on Wednesday that crude oil production has resumed at several oil fields after the force majeure on oil exports was lifted last week.
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