Oil Declines for a Third Day as Rates and Geopolitics Dominate

Brent crude dropped toward $85 a barrel after losing almost 2% over the last two days. But, West Texas Intermediate was below $81. A surprise rate cut from the Swiss National Bank boosted the dollar, a headwind for commodities priced in the greenback. That move followed the Federal Reserve signaling that a trio of US cuts remained on the cards this year.

]Crude has still advanced in the first quarter, having broken out of a narrow range in recent weeks on US inventory drawdowns, OPEC+’s production cuts and as Ukrainian attacks on Russian territory, including against refineries, intensified. However, gains have been limited by surging supply from outside the group and a muddled economic outlook in top importer China.

Despite the several drivers, oil markets have been relatively calm, with a gauge of volatility for global benchmark Brent sinking to a four-year low. Meanwhile, Gasoline is showing signs of strength, with the profit margin for making the fuel from crude in the US near the widest since August.