Crude oil futures ended deeply in red with cut of over three and half percent on Tuesday amid lingering concerns about the outlook for fuel demand and worries about possible oversupply in the market. Worries about oversupply persist despite OPEC+'s plans to reduce output by 2.2 million barrels per day in the first quarter of 2024, as production in the U.S. reached a fresh all-time high of 13.2 million bpd in September, and production in Canada is set to rise by 10% next year to a record high of around 5.3 million bpd. Also, data showing persisting inflationary pressures reinforced the view that the Federal Reserve is unlikely to cut interest rates anytime soon. The Labor Department's report said the consumer price index crept up by 0.1% in November after coming in unchanged in October.
Benchmark crude oil futures for January delivery fell $2.71 or about 3.8 percent to settle at $68.61 a barrel on the New York Mercantile Exchange. Brent crude for February delivery dropped $2.79 or about 3.7 percent to settle at $73.24 a barrel on London's Intercontinental Exchange.