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Oil Prices Slip On Supply Release Expectations

Oil prices fell more than 1 percent on Tuesday ahead of the expected release of U.S. crude reserves to cool the market.

Demand concerns also weighed due to the resurgence of Covid-19 cases in Europe.

Benchmark Brent crude futures fell 87 cents, or 1.1 percent, to $78.83 a barrel, while U.S. West Texas Intermediate (WTI) crude futures were down $1.11, or 1.4 percent, at $75.66 a barrel.

On Monday, prices rose more than 1 percent after comments by OPEC delegates that they could adjust their monthly output hike if governments choose to tap state oil reserves.

A White House official confirmed Monday night that President Biden will announce on Tuesday a plan to release oil from the Strategic Petroleum Reserve, in coordination with other countries such as China, India and Japan to lower energy prices.

India plans to release about 5 million barrels of crude oil from its emergency stockpile, starting as early as 7-10 days, a top government official reportedly said earlier today.

While a release from reserves is expected to have only a temporary impact on prices, a new wave of lockdowns in Europe to halt the spread of Covid-19 could weigh on economic and oil demand growth, analysts have said.

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