Oil prices fell Wednesday as investors took profits before announcing a Federal Reserve decision and US Energy Information Administration data on crude oil stocks, but fears of a shortage of supply due to geopolitical tensions limited the losses.
Oil prices hit a seven-year high last week amid fears of limited supplies due to tensions between Ukraine and Russia.
US President Joe Biden said Tuesday he would take in Consider sanctions against President Vladimir Putin if Moscow invades Ukraine, as Western leaders have stepped up military preparations and drawn up plans to protect Europe from a potential energy supply crisis.
Concerns over the Middle East also increased on Monday, when Yemen’s Iranian-aligned Houthi movement launched a missile strike on a base in the United Arab Emirates that is home to US forces. US and UAE officials said US Patriot missiles thwarted the attack.
“The market trend is limited due to growing tension between Russia and Ukraine and the threat to infrastructure in the UAE,” said Hiroyuki Kikukawa, general manager of research at Nissan Securities.
THE future Brent crude oil fell 32 cents, or 0.4%, to $ 87.88 a barrel, after jumping 2.2% in the previous session.
THE future US West Texas Intermediate crude oil fell 45 cents, or 0.5%, to $ 85.15 a barrel, after rising 2.8% on Tuesday.
The Federal Reserve concludes its two-day meeting later in the day as traders eagerly await further guidance on the timing and pace of interest rate hikes, as well as how the U.S. central bank will begin cutting its balance sheet by nearly $. 9 trillion.
Weekly US inventory data released overnight by the American Petroleum Institute was in in line with expectations.
Sources said the data showed a decline in U.S. crude oil and distillate inventories, while gasoline stocks rose during the week ending Jan.21.
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