Ana sayfa » Oil stays flat as fall in US crude inventories offsets interest rate hike concerns

Oil stays flat as fall in US crude inventories offsets interest rate hike concerns

Fed lays the groundwork for rate hikes, dollar's rise limits oil


Oil prices were flat on Wednesday after the market tumbled in the previous session on fears that more aggressive US rate hikes will hit demand, as API industry data showed an unexpected drop in US crude inventories.

Brent crude futures rose 18 cents, or 0.2%, at 0452 GMT to $83.47 per barrel, while West Texas Intermediate (WTI) crude futures gained 4 cents to $77.62 a barrel.

Data from the American Petroleum Institute (API), according to market sources, showed that US crude inventories fell by about 3.8 million barrels in the week ended March 3. The drop challenged some analysts’ forecasts for a 400,000-barrel increase in crude oil inventories.

However, short-term drivers point to a more bearish outlook as investors prepare for tougher rate hikes in the US.

Fed Chairman Powell’s comments on ‘longer higher’ interest rates spooked markets and plunged risky assets, including commodities, sharply overnight.

Traders await crude inventories data from the U.S. Energy Information Administration (EIA) on Wednesday after API data showed crude inventories falling for the first time in a 10-week increase.

Both Brent and WTI fell more than 3% on Tuesday after comments from the Federal Reserve that it would likely need to raise interest rates more than expected in response to the latest strong data.

This raised concerns about weak demand in the US.

Powell’s comments pushed the US dollar, which typically trades inversely with oil, to a three-month high against a basket of currencies.

The dollar index rose as high as 105.65 on Tuesday by 1.3% and the highest gain since Dec.