Sign Up for FREE Daily Energy News
Canadian Flag CDN NEWS  |  US Flag US NEWS  | TIMELY. FOCUSED. RELEVANT. FREE
  • Stay Connected
  • linkedin
  • twitter
  • facebook
  • youtube2
BREAKING NEWS:

Vista Projects
Copper Tip Energy Services
Vista Projects
Copper Tip Energy


Oil Prices Rise after U.S. Interest Rate Cut


These translations are done via Google Translate

(Reuters) – Oil prices rose on Thursday after a large interest rate cut from the U.S. Federal Reserve, but Brent was still hovering around its lowest levels of the year, below $75, on expectations of weaker global demand.

Brent crude futures for November were up 81 cents, or 1.1%, to $74.46 a barrel at 0750 GMT, while WTI crude futures for October were also up 1.1%, rising 75 cents to $71.66 a barrel. The benchmarks recovered after falling in early Asian trade.

The U.S. central bank cut interest rates by half a percentage point on Wednesday. Interest rate cuts typically boost economic activity and energy demand, but the market also saw it as a sign of a weaker U.S. labor market that could slow the economy.

“While the 50 basis point cut hints at harsh economic headwinds ahead, bearish investors were left unsatisfied after the Fed raised the medium-term outlook for rates,” ANZ analysts said in a note.

Weak demand from China’s slowing economy also continued to weigh.

Refinery output in China slowed for a fifth month in August, statistics bureau data showed over the weekend. China’s industrial output growth also slowed to a five-month low last month, and retail sales and new home prices weakened further.

Markets were also keeping an eye on events in the Middle East after walkie-talkies used by Lebanese armed group Hezbollah exploded on Wednesday following similar explosions of pagers the previous day.

ROO.AI Oil and Gas Field Service Software
GLJ

The massive blaze broke out Monday morning, knocking out power to thousands of homes, and prompting a widespread evacuation of the area.00:1101:25

Security sources said Israeli spy agency Mossad was responsible, but Israeli officials did not comment on the attacks.

Citi analysts say they expect a counter-seasonal oil market deficit of around 0.4 million barrels per day (bpd) to support Brent crude prices in the $70 to $75 a barrel range during the next quarter, but that would be temporary.

“As 2025 global oil balances deteriorate in most scenarios, we still anticipate renewed price weakness in 2025 with Brent on a path to $60/barrel,” Citi said in a note on Thursday.

Reporting by Paul Carsten in Nairobi, Colleen Howe in Beijing and Sudarshan Varadhan in Singapore; Editing by Mark Potter and Shri Navaratnam

 

Share This:




More News Articles


GET ENERGYNOW’S DAILY EMAIL FOR FREE