Crude Oil Futures Fall on Wednesday While Supplies Remain Replete

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Oil futures settled below $50 a barrel on Wednesday as a weekly government report revealed a plateau in crude oil inventories, according to Bloomberg MarketWatch.

On the New York Mercantile Exchange, August West Texas Intermediate crude shed 72 cents, or 1.4%, to end trading at $49.13 a barrel, falling from $50.18 a barrel before release of the supply data update.

On London’s ICE Futures Exchange, August Brent crude, the global benchmark, dropped 74 cents, or 1.5%, to settle at $49.88 a barrel.

On Wednesday, the U.S. Energy Information Administration report revealed that crude oil supplies dropped by 900,000 barrels for the week ending June 17, according to the Bloomberg report. Analysts projected a decrease of 1.4 million barrels while Tuesday’s American Petroleum Institute report reflected a decline of 5.2 million barrels.

On the New York Mercantile Exchange, July natural gas fell 9.1 cents, or 3.3%, to settle at $2.677 per million British thermal units.

Traders are now focused on this week’s Brexit vote and its impact on the oil and gas industry.

“The Brexit vote is definitely the most significant factor on crude’s horizon,” said Robbie Fraser, commodity analyst at Schneider Electric. “The market continues to be relatively confident that the remain vote will prevail tomorrow. As such, a vote to stay may only offer slight momentum higher, while a surprise victory for the leave camp would be a significantly bearish factor for oil prices and global markets at large.”

 

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