As a result of the low level of liquidity, which negatively affected the vitality of the market, it is no longer difficult for oil prices to move in a downward direction at the present time, and the two main indicators in the crude markets have now lost all the gains they achieved in 2022.
On Wednesday, prices headed lower for the fourth consecutive day, with West Texas Intermediate crude trading near $72 a barrel and Brent crude falling to its lowest level in almost a year.
The market once again turned into a new bearish trend due to signs of easing restrictions on US fuel supplies and the increasing risk aversion of investors.
US distillate inventories rose by more than 6 million barrels, according to a report released Wednesday by the Energy Information Administration. Gasoline stocks jumped by 5.3 million barrels, indicating weak demand.
So far, crude oil prices have faltered in the last months of the year, with the US benchmark heading towards its first quarterly decline for two consecutive periods since mid-2019 as central banks tighten monetary policy.
Prices were negatively affected by concerns related to the outlook for global economic growth, in addition to the weakness of the direct trading market for the commodity and the decline in liquidity.
The recent market downturn comes at a complex moment, as traders calculate the negative consequences of G7 restrictions imposed on Russian oil, including price caps intended to punish Moscow for the war in Ukraine.
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