SULAIMANI (ESTA) — Oil prices fell on Wednesday after U.S. President Donald Trump cancelled talks on a fourth stimulus package to boost the coronavirus-hit economy and on a larger-than-expected increase in U.S. crude inventories.
Brent crude LCOc1 futures fell by 47 cents, or 1.1%, to $42.18 a barrel at 0619GMT while U.S. West Texas Intermediate (WTI) crude CLc1 oil futures fell 56 cents, or 1.38%, to $40.11 a barrel.
Trump, still being treated for COVID-19, ended talks on Tuesday with Democrats on an economic aid package for the United States, the world’s biggest oil consumer, with the U.S. presidential election only weeks away.
“Crude prices got hammered with one-two punch after President Trump sent all risky assets into freefall after ending negotiations on fiscal stimulus and after US crude stockpiles posted their first build in four weeks,” said Edward Moya, senior market analyst at OANDA, Reuters reported.
“President Trump’s decision to end fiscal stimulus talks surprised markets. While many didn’t expect to see a deal reached before the election, the abrupt end sent all risky assets sharply lower,” Moya added.
Price were also pressured by data from the American Petroleum Institute showing U.S. oil stockpiles rose by 951,000 barrels last week.
But losses were limited by restrictions on the supply side.