2023-05-25 03:51:13
Oil prices fell in early Asian trading, Thursday, in light of the uncertainty that the United States would avoid defaulting on its obligations, which outweighed the impact of speculation that the OPEC + alliance would make more production cuts.
Fitch has placed the AAA credit rating of the United States on watch for a possible downgrade due to the risk of Washington defaulting on its debts if the US public debt ceiling is not raised.
The agency said in a statement that its decision “reflects the growing political tensions that impede resolving the problem by raising or suspending the public debt ceiling, at a time when the deadline” for the US public debt to reach the ceiling legally set for it is fast approaching.
House Speaker Kevin McCarthy announced Thursday that some progress has been made in negotiations to raise the US debt ceiling, but there are still many outstanding issues, while the deadline approaches to raise the federal government’s borrowing limit of $ 31.4 trillion or risk defaulting on obligations.
Negotiators representing Democratic President Joe Biden and McCarthy held what both sides described as productive talks Wednesday at the White House, trying to seal a deal.
Oil prices were also pressured by news of a smaller-than-expected decline in Britain’s high inflation rate last month, according to official data, which increased chances of a rate hike.
price move
By 0342 GMT, Brent crude futures fell 4 cents, or 0.05 percent, to $78.32 a barrel. US West Texas Intermediate crude fell 14 cents, or 0.2 percent, to $74.20, according to Archyde.com data.
In the previous session, oil prices received support from the Saudi Energy Minister saying that short sellers who bet on lower oil prices should “beware”.
Some investors expected that this was a sign that the OPEC + alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, may consider approving further production cuts during its meeting on the fourth of June.
Oil also received support from the unexpectedly large decline in US crude oil inventories in the week ending May 19, which was announced by the Energy Information Administration on Wednesday.
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