RIYADH: Oil prices dipped on Tuesday, paring some gains from the previous session, as the market feared that more aggressive interest rate hikes from central banks may lead to a global economic slowdown and soften fuel demand.
Brent crude futures for October settlement dropped 3.56 percent to $101.35 a barrel at 03.00 p.m Saudi time.
US West Texas Intermediate crude was at $94.23 a barrel, down 2.87 percent.
Crude in US emergency reserve falls to lowest since December 1984
Crude inventory in the US emergency reserves fell by 3.1 million barrels in the week to Aug. 26, according to data from the Department of Energy.
Stockpiles in the Strategic Petroleum Reserve fell to 450 million barrels, according to the data, the lowest since December 1984.
The 3.1 million-barrel draw was the smallest draw since the end of April.
Ecuador’s state oil firm warns Trafigura to stop Russian diesel imports
Ecuadoran state oil company Petroecuador has asked global commodities trader Trafigura to stop importing Russian diesel in an effort to comply with sanctions targeting Russia’s energy exports, Petroecuador said in a statement late on Sunday.
Petroecuador’s public warning to Trafigura follows EU and US sanctions imposed on Russian energy supplies after Moscow invaded Ukraine in February. Russia calls its actions in Ukraine “a special military operation.”
Petroecuador seeks to stop Russian imports in order to prevent repercussions, including sanctions on Ecuador as well as the country’s own officials. The Andean country depends on foreign diesel supplies primarily for motor fuel and electricity.
According to a diesel sales contract awarded in June to Geneva-based Trafigura, the trader was warned to avoid Russian supplies as it delivered 1.68 million barrels of diesel to Petroecuador in six shipments between July and September.
In its statement, Petroecuador noted it had already found one shipment contained mostly Russian products.
Trafigura was set to deliver a fourth diesel shipment of around 275,000 barrels on Saturday, 95 percent of which was of Russian origin with the remaining 5 percent from Panama, according to the Petroecuador statement. It is unclear what the status of the shipment is.
Trafigura said in a statement on Monday that it does not comment on individual shipments but that it is in full compliance with EU sanctions, without going into further detail. It did not address Petroecuador’s request to stop importing Russian diesel.
(With input from Reuters)
