Oil prices dipped on Tuesday after the U.S. government said it would release more crude from its Strategic Petroleum Reserve, while traders look out for U.S. inflation data for further queues.
Brent crude futures fell 80 cents, or 0.9%, to $85.81 per barrel by 1003 GMT, while U.S. crude futures fell $1.05, or 1.3%, to $79.09 per barrel. Both benchmarks are on track for their biggest daily percentage drop since Feb. 3.
The DOE had considered cancelling the fiscal year 2023 sale after U.S. President Joe Biden’s administration last year sold a record 180 million barrels from the reserve. But that would have required Congress to act to change the mandate.
Supply concerns also eased after the Energy Information Administration said it expected record March production from the seven biggest U.S. shale basins.
Traders will also be looking for clues from Tuesday’s crucial U.S. consumer price index (CPI) data for January. U.S. monthly consumer prices rose in the previous two months.
“The upcoming data tsunami will greatly influence the immediate risk appetite, but the broader view has not changed: inflation will ultimately be defeated,” said PVM analyst Tamas Varga.
“The second half of the year should bring with it tight oil balance greatly aided by reviving Chinese growth.”
