Crude prices are still set to end this week lower

The ease is due to fears of higher interest rates in the developed world spurred a heavy dose of profit-taking.

The Federal Reserve warned that interest rates will remain higher for longer through 2024, as did the Bank of England and the European Central Bank.

However, a fuel export ban by Russia on Thursday added to expectations of tighter supply, after Moscow blocked fuel shipments to most countries beyond four ex-Soviet states with immediate effect causing global oil prices to spike and eroding weeks downward momentum.

Unfortunately, the prospect of tighter supplies kept oil prices trading relatively higher for the year. A combined 1.3 million barrels per day cut from Russia and Saudi Arabia is set to substantially limit oil supplies in the coming months and keep us in a high-price environment as we head into the final quarter of 2023.

Brent oil- the global benchmark- is expected to trend between $90 to $100 a barrel through the remainder of 2023. Inventory data released earlier this week also showed U.S. supplies remained tight, even with the end of the travel-heavy summer season.

Nevertheless, downward pressure does still remain as oil markets were hit particularly hard by hawkish signals from the Federal Reserve this week. While the central bank kept rates steady, it warned that borrowing costs could still increase further this year, and will fall by a smaller-than-expected margin in 2024.

The warning, coupled with similar signals from the BOE and ECB, ramped up concerns that rising interest rates will weigh on economic activity and oil demand in the coming months.

Strength in the dollar- which traded at six-month highs on the Fed’s signaling- also weighed on crude markets, given that it makes oil more expensive for international buyers.

Focus is now on a Bank of Japan meeting later in the day for more cues on monetary policy, especially as the bank signaled a potential end to its negative rate regime.

Fuel card users can have an increase of .26 pence per litre as we head into the final week of September.