Oil slumps by more than $5 as Biden expected to cut U.S. fuel cost | Reuters

Oil slumps by more than $5 as Biden expected to cut U.S. fuel cost | Reuters

Oil prices tumbled by more than $5 a barrel on Wednesday amid a push by U.S. President Joe Biden to cut fuel costs for drivers in the latest episode to aggravate relations between the White House and the U.S. oil industry.

Brent crude futures were down $5.10, or 4.5%, to $109.55 a barrel while U.S. West Texas Intermediate (WTI) futures were down $5.37, or 5.9%, at $104.15 as of 0800 GMT.

The contracts earlier hit their lowest levels since May 19 and 12, respectively.

Biden on Wednesday is expected to call for temporarily suspending the 18.4 cents per gallon federal tax on gasoline, a source said, as the United States, the world's largest oil consumer, struggles to tackle soaring gasoline prices and inflation. read more

"The latest in a long line of attempts to temper surging prices at the pumps is having the desired effect. Yet whether this knee-jerk reaction will stand the test of time is by no means guaranteed," said PVM's Stephen Brennock, pointing to an expected summer demand surge.