Drop in Oil Price: factors at play

Even before the forecast by the EIA of impending drop in price at the pumps during the US Labour weekend, the price of the commodity had been in decline, not plummeting.

The trend appeared, even when there was no significant increase in US crude oil inventories.

oil price weekly stocks

On Thursday, the main crude oil benchmarks in the US and Europe were down, nearly 1.3%.

Analysts believe that the following factors may have played a role in the sudden, unexpected drop:

  1. Slow refinery runs
  2. Temporary closer of refineries for maintenance
  3. The news that China struggles to get oil from offshore vessels to storage facilities
  4. Tendency to interpret China’s increased refineries as slow economic activity
  5. Strong dollar
  6. Low demand for jet fuel



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