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Brexit and US data put oil under pressure

Oil prices fell for the sixth session in a row on June 16, affected by market worries about the coming E.U referendum happening in the UK, and mixed oil data from the United States.

Crude oil prices had been on a downward trend for days before this, knocked down by the prospect that a drop-off in U.S shale production, which has been ongoing since April 2015, could be reversing as the quantity of drilling rigs in the country grows.

Brent crude fell by 1.5% to just $48.23 (£32.96) per barrel on the London-based ICE Futures Exchange, whilst West Texas Intermediate also saw a decline of 1.5% to $47.30 (£32.32) per barrel.

Worldwide stocks have recently been sold off due to fears that Brits will vote to leave the European Union, and that the Brexit vote will cause chaos to the financial markets and have a negative effect on the economy, spurred on by the fact that Brexit opinion polls have narrowed in recent days.

Analysts have commented that the slump in the market is feeding through to oil prices. JBC Energy analysts commented:

“The increased chances of a Brexit could be a catalyst for weak market fundamentals feeding through into outright price declines.”

However, it remains to be seen just how damaging a vote for Brexit could actually be to the likes of Royal Dutch Shell and Fuchs, the latter of which produces some of the world’s most popular oil-based products, including Fuchs Ecocool Ultralife A.

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