WASHINGTON, June 22 (NNN-AGENCIES) — Oil prices skidded in early trade on Wednesday amid a push by US President Joe Biden to bring down soaring fuel costs, including pressure on major US firms to help ease the pain for drivers during the country’s peak summer demand.
US West Texas Intermediate (WTI) crude futures fell $1.34, or 1,2 per cent, to $108.18 a barrel at 0031 GMT, while Brent crude futures dropped $1.33, or 1.2 per cent, to $113.32 a barrel.
As the United States struggles to tackle soaring gasoline prices and inflation, Biden is expected on Wednesday to call for temporarily suspending the 18.4-cents a gallon federal tax on gasoline, a source said. Biden had disclosed on Monday he was considering whether to call for a pause in the tax.
Seven oil companies are set to meet Biden on Thursday, under pressure from the White House to drive down fuel prices as they make record profits.
Chevron Chief Executive Michael Wirth, however, on Tuesday, said criticising the oil industry was not the way to bring down fuel prices.
“These actions are not beneficial to meeting the challenges we face,” Wirth said in a letter addressed to Biden, which sparked a response from Biden saying the industry was being too sensitive.
Despite worries about inflation, demand is still on the road to recovery to pre-COVID levels and supply is expected to lag demand growth, keeping the market tight, as flagged by trading giant Vitol and Exxon Mobil Corp this week.
European oil sanctions on Russia for its invasion of Ukraine have yet to take effect, meaning supply will only get tighter.
“The market is still coming to terms with the increasing disruption to Russian oil. European sanctions have yet to kick in,” ANZ Research analysts said in a note, pointing to data showing that so far there has only been a relatively limited drop in Russian fuel supply to Europe since the conflict began. — NNN-AGENCIES
