Oil falls for second day on demand woes, but U.S. stock draw and Fed rate cut limit losses

[Oil pipeline in the sunset]
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Crude oil prices declined for a second consecutive session on Thursday, weighed down by persistent concerns over a potential supply surplus and weakening demand in the U.S. market.

West Texas Intermediate (CL1:COM [https://seekingalpha.com/symbol/CL1:COM]) eased 0.2% at $63.95 a barrel, while Brent (CO1:COM [https://seekingalpha.com/symbol/CO1:COM]) fell 0.4% to $67.67.

However, a huge inventory draw in the U.S. and interest rate cut by the U.S. Federal Reserve have helped to keep the losses in check, ING analysts said.

As widely expected, the Fed has resumed cutting interest rates with a 25bp move yesterday. They think three more cuts will be enough to boost growth and prompt a revival in the jobs market, but the market is skeptical, the analysts said.

The indication of more rate cuts coming from the Fed signals that policymakers assess risk to the economy from unemployment to be higher than from inflation, said Claudio Galimberti, chief economist and global director of market analysis at Rystad Energy, in a client note.

Elsewhere, U.S. natural gas futures (NG1:COM [https://seekingalpha.com/symbol/NG1:COM]) floated [https://seekingalpha.com/article/4823782-us-natural-gas-steadies-near-3-10-output-declines-offset-weak-demand]around $3.10 as production dropped to its lowest in three months.

ETFs: (NYSEARCA:USO), (BNO [https://seekingalpha.com/symbol/BNO]), (NYSEARCA:UCO), (SCO [https://seekingalpha.com/symbol/SCO]), (USL [https://seekingalpha.com/symbol/USL]), (DBO [https://seekingalpha.com/symbol/DBO]), (DRIP [https://seekingalpha.com/symbol/DRIP]), (GUSH [https://seekingalpha.com/symbol/GUSH]), (USOI [https://seekingalpha.com/symbol/USOI]), (UNG [https://seekingalpha.com/symbol/UNG]), (BOIL [https://seekingalpha.com/symbol/BOIL]), (KOLD [https://seekingalpha.com/symbol/KOLD]), (UNL [https://seekingalpha.com/symbol/UNL]), (FCG [https://seekingalpha.com/symbol/FCG]), (NYSEARCA:XLE)

MORE ON BRENT FUTURES, CRUDE OIL FUTURES

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