Demand And Supply Concerns, Oil Prices Fall 3%

<p>&nbsp;Today, oil prices fell more than 3% from yesterday and hit a six-month low due to concerns over oversupply and US economic data showing an unexpected rise in consumer prices.</p><p><br /></p><p>Brent crude futures for February fell by $2.79 (3.7%) to $73.24 a barrel while US West Texas Intermediate crude for January also fell by $2.71 (3.8%) to $68.61 a barrel.</p><p><br /></p><p>In the United States, the monthly consumer price index unexpectedly rose in November along with the core reading. This report slightly invites speculation about the Federal Reserve (Fed) possibly considering raising interest rates after this.</p><p><br /></p><p><br /></p><p>According to John Kilduff who is a partner of Again Capital LLC, higher rates in the long term can slow economic growth and can disrupt the demand for crude oil in the future.</p><p><br /></p><p>OPEC and the International Energy Agency predict a slowdown in global oil demand growth in 2024. Kpler analyst Matt Smith notes that negative sentiment towards the oil complex remains dominant.</p><p><br /></p><p>The EIA forecasts an increase in US crude oil production of 1.02 million barrels per day to 12.93 million barrels in 2023 and 180,000 barrels to 13.11 million barrels in 2024. The current high for US crude oil production is 12.21 million barrels.</p><p><br /></p><p>Meanwhile, it was reported that Yemen's Houthi group attacked a Norwegian commercial tanker following their latest protest against Israel's violence against Gaza. Indirectly, this could increase the risk of supply disruptions in the region.</p>