Oil rises in price on slower US inflation, strong demand
Kyiv • UNN
Oil prices continued to rise on Thursday amid signs of strong demand and slowing inflation in the US.
On Thursday, futures for Brent crude oil for July delivery rose to $83.20 per barrel during trading, UNN reports citing trading data.
According to Bloomberg, as of 8:50 a.m., the price of Brent crude oil futures rose by 0.54%.
At the same time, the price of June futures for WTI rose to $79.09 per barrel, adding 0.58%.
Details
Oil prices continued to rise compared to the previous session on Thursday amid signs of stronger demand in the US, where data showed slower inflation than markets expected, strengthening the case for lower interest rates, which could lead to even greater consumption growth, Reuters notes.
"More subdued April US inflation data and much weaker-than-expected US retail sales data seem to give the Fed room to consider an earlier rate cut, with market expectations leaning more firmly toward policy easing starting in September this year," said IG market strategist Yep Jun Rong.
"Last week's larger-than-expected decline in U.S. crude oil inventories also provided some reassurance, while geopolitical tensions in the Middle East continue to mount," he said.
Signs of slowing inflation and rising demand have supported prices, ANZ Research also said in a note to clients, as well as geopolitical risk, which it believes remains elevated.
In the Middle East, Israeli troops fought Hamas militants throughout Gaza, including Rafah, which had been a haven for civilians. Negotiations on a ceasefire mediated by Qatar and Egypt have reached a deadlock: Hamas demands a halt to attacks, while Israel refuses until the group is destroyed.
Growth was limited after the IEA cut its forecast for oil demand growth in 2024, widening the gap between its opinion and that of the OPEC group of producers. Global oil demand will grow by 1.1 million barrels per day this year, the IEA said, 140,000 barrels per day less than in its previous forecast, mainly due to weak demand in developed countries of the Organization for Economic Cooperation and Development.
