Oil inched higher in a choppy session as a traders weighed a hawkish rate outlook from central banks against positive signals from the world’s largest economy.
(Bloomberg) — Oil inched higher in a choppy session as a traders weighed a hawkish rate outlook from central banks against positive signals from the world’s largest economy.
US data on Thursday showed a resilient economy and jobs market, signaling potentially strong demand for crude. But the reports also raise the likelihood that the Federal Reserve will keep boosting interest rates. Fed Chair Jerome Powell added to the hawkish overhang on prices by saying that at least two interest-rate increases are likely necessary this year to keep bringing inflation lower.
US benchmark crude is on track for its first back-to-back quarterly decline since 2019 on China’s lackluster economic recovery and the Federal Reserve’s aggressive monetary tightening. Supply has also been plentiful, bolstered by resilient exports from Russia, despite sanctions.
US crude inventories shrank by 9.6 million barrels last week, the largest drawdown in more than a month, according to the Energy Information Administration. Gasoline demand averaged over a four-week period surged to the highest since 2021.
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