Oil prices experienced a slight decline on Wednesday, as investors remained skeptical of China’s recently announced stimulus efforts, while ongoing tensions in the Middle East continue to pose significant concerns.
The price of North Sea Brent crude for November delivery fell by 0.73% to $74.62 per barrel. Meanwhile, its American counterpart, West Texas Intermediate (WTI), for the same month, decreased by 0.81% to $70.58 per barrel.
This week, the People’s Bank of China (PBoC) implemented a series of measures aimed at bolstering the world’s second-largest economy, which is the leading oil importer and still recovering from the coronavirus pandemic. Among these measures was a reduction in the medium-term lending facility (MLF) interest rate from 2.3% to 2%.
However, this proved insufficient to sustainably elevate oil prices, as one analyst noted, “oil traders have had time to reassess the actual impact of these measures on crude demand.”
Investors are also closely monitoring the escalating tensions in the Middle East. In addition to the situations in China and the Middle East, oil prices are affected by the state of U.S. crude inventories, which fell by 4.34 million barrels last week, while gasoline stocks dropped by 3.44 million barrels, according to the American Petroleum Institute (API).
