Almost the entire commodity complex dropped in price in Thursday's session with 25 out of 29 front month commodity futures contracts declining. Natural Gas Futures led the way with a 4.8% drop.
The 2.2% drop in WTI Crude futures was not that large on a relative basis but we are going to focus on oil today because a) WTI Crude just broke out of a range in had been trading in for the past three and a half weeks and b) oil's significance to the global economy. WTI Crude has now given back half of the February run up and is heading back towards double digits.
One of the main reasons for the drop in WTI prices was the higher than expected rise in U.S. crude oil inventories.
From the Nasdaq:
Crude oil stockpiles rose 7.1 million barrels to 353.4 million barrels, compared with an average survey estimate calling for a build of 2.2 million barrels.
Brent has seen a recent drop as well but not to the same extent as WTI and Brent is still trading within this past month's range:
With Brent remaining elevated, it means that European consumers, with some of the highest gas prices in the world (as seen on the following chart), are less likely to see any relief than U.S. based consumers who already deal with below-average fuel costs.
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