Oil Prices Fall as Traders Await Powell’s Testimony
Oil Prices Take a Dip
Oil prices experienced a decline on Thursday, halting a recent upward trend as traders looked for more guidance from Federal Reserve Chair Jerome Powell on future monetary policies.
Powell’s Testimony Impact
By 09:05 ET (14.05 GMT), oil futures were down 0.7% at $78.58 a barrel, while the contract dropped 0.6% to $82.49 a barrel. Powell’s statements regarding potential interest rate cuts had initially boosted oil prices on Wednesday, but comments from Minneapolis Fed chief Neel Kashkari tempered this optimism.
China’s Positive Trade Data
China’s trade data for January-February exceeded expectations, indicating a positive turn in global trade. Imports rose by 5.1% during this period, reaching about 10.74 million barrels per day, showcasing increased crude purchases to meet fuel demands during the Lunar New Year holiday.
US Inventories Support Tightening Supply
New data revealed that U.S. inventories showed a smaller-than-expected build in the first week of March, signaling a tightening supply situation. Additionally, both crude and fuel inventories saw significant draws, further boosting optimism about a reduction in global oil supplies.
Market Outlook and Forecast
Analysts predict that Brent oil prices are likely to rise towards the upper end of the $70-90 range in the upcoming months, driven by a modest deficit in the market. They anticipate a peak of $87/bbl in July, citing various supply and demand factors influencing the oil market.
