Crude oil prices retreated on Thursday as expectations of reduced U.S. fuel consumption weighed on market sentiment.
Brent crude oil, against which Nigerian crude oil is priced, fell by 8 cents or 0.1 percent to $67.97 per barrel, while West Texas Intermediate (WTI) crude oil dropped 4 cents to $64.11 per barrel as of 11:56 a.m.
The decline followed a midweek rise after data from the U.S. Energy Information Administration (EIA) showed a 2.4 million-barrel drawdown in crude inventories for the week ended August 22, exceeding analysts’ forecast of 1.9 million barrels.
However, traders highlighted the end of the U.S. summer driving season with the upcoming Labor Day holiday as a key factor behind weaker demand expectations.
“This weekend’s U.S. bank holiday marks the end of the driving season and gasoline has hardly been the panacea hoped for in terms of demand,” said John Evans of PVM Oil.
In addition, the resumption of Russian crude flows through the Druzhba pipeline to Hungary and Slovakia after a brief outage further pressured the market.
The restart, confirmed by Hungarian oil company MOL and Slovakia’s economy ministry, restored supplies disrupted by a Ukrainian strike last week.
Geopolitical risks remain in play as Russia and Ukraine intensified attacks on each other’s energy infrastructure.
Ukrainian officials reported that a massive drone strike by Russia targeted energy and gas transport facilities across six regions, leaving more than 100,000 people without power.
Meanwhile, U.S. President Donald Trump’s decision to double tariffs on Indian imports to as high as 50 percent has drawn attention to New Delhi’s continued purchases of Russian oil.
Analysts at IG Markets said India is expected to maintain its Russian crude imports in the short term, limiting the broader impact of U.S. trade measures on global supply.
Despite the geopolitical backdrop, analysts note that short-term support for crude remains weak. “Any short-term reasons to be friendly towards oil prices are diminishing,” Evans added, citing reduced gasoline demand and resumed Russian flows.
The market will continue to monitor U.S. consumption trends following the holiday weekend, as well as the extent of disruptions from ongoing military strikes on energy infrastructure in Eastern Europe.