Oil Futures Snap 3-day Winning Streak, Settle Sharply Lower

Crude oil prices fell sharply on Thursday, snapping a three-day winning streak, after Russian Deputy Prime Minister said Russia won’t agree on any additional cut in crude production.

A firm dollar, and uncertainty over US debt weighed as well on crude oil prices.

Fitch Ratings placed the United States “AAA” credit on “rating watch negative,” signaling downside risks to U.S. creditworthiness.

House Speaker Kevin McCarthy said that some progress had been made but several issues remained unresolved in negotiations, as the deadline ticked closer to raise the federal government’s $31.4 trillion borrowing limit or risk default.

West Texas Intermediate Crude oil futures for July ended down $2.51 or about 3.4% at $71.83 a barrel.

Brent crude futures were down $2.22 or 2.8% at $76.14 a barrel a little while ago.

Russian Deputy Prime Minister Alexander Novak reportedly said that he doesn’t think there will be any new steps with regard to production cuts. ” Just a month ago certain decisions were made regarding the voluntary reduction of oil production by some countries. The Saudis were trying to talk up oil prices and dangle a threat of more production cuts, but it looks like Russia won’t be on board for additional cuts,” Novak said.

Saudi Energy Minister Abdulaziz bin Salman had hinted just 24 hours earlier of the possibility of another round of production cuts at OPEC+’s meeting on June 4.

Worries about a recession in Germany hurt. Official data showed German economy entered a technical recession in the first quarter of this year.

GDP declined a seasonally and calendar adjusted 0.3% from the fourth quarter of last year as household consumption slumped amid the rising cost of living that is fueled by high inflation, revised data from the statistical office Destatis showed.

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