Oil prices decline following downward revision of US GDP

The front-month ICE Brent contract lost $1.74/bbl to settle at $81.86/bbl on Thursday, after the US Department of Commerce revised downward its GDP estimate for the first quarter.  

PHOTO: Getty Images

Oil prices reacted negatively to the news as it showed the country's economic growth in the first quarter of this year was slower than previously estimated.

The US gross domestic product (GDP), a key indicator of demand growth and consumer spending activity, increased at an annualised rate of 1.3% in the first three months of this year, down from the initial estimate of 1.6%, the commerce department said.  

The data marked a significant decrease from the 3.4% growth rate recorded in the last quarter of 2023, prompting market analysts to speculate a slowdown in demand in the world’s largest oil consuming nation.

Brent’s price declined as “[market] sentiment was also impacted by US GDP, which was revised lower,” ANZ Bank’s senior commodity strategist Daniel Hynes remarked.

By Aparupa Mazumder 

Please get in touch with comments or additional info to news@engine.online