Brent futures gained 23 cents, or 0.31 per cent, settling at $74.49 a barrel and U.S. WTI crude added 11 cents, or 0.16 per cent, and settled at $69.58 a barrel
Oil prices rose in Asian trade on Thursday, extending earlier gains, on a bigger-than-expected weekly withdrawal from U.S. crude storage and demand expectations after the U.S. Fed sent signals on lower borrowing costs in 2024.
Brent futures gained 23 cents, or 0.31 per cent, settling at $74.49 a barrel by 0345 GMT. U.S. WTI crude added 11 cents, or 0.16 per cent, and settled at $69.58 a barrel.
The market rose in the earlier session on concerns about the security of Middle East oil supplies following a tanker attack in the Red Sea.
Crude oil prices bounced back before the Fed meeting, and the event lifted them further, said CMC Markets’ analyst Tina Teng in a client note.
Lower interest rates lower consumer borrowing costs, which can boost economic growth and demand for oil. The news also sent the dollar dropping for three successive sessions to a four-month low, which makes oil less expensive for foreign purchasers.
Prices were boosted by a larger-than-expected draw from the U.S. crude inventory, Teng said.
The U.S. EIA said energy companies pulled a bigger than expected 4.3 million barrels of crude from stockpiles during the week ended December 8 as imports dropped.
Dissipating concerns about demand growth boosted the market as well, after the Organization of the Petroleum Exporting Countries (OPEC) blamed the latest crude price decline on “exaggerated concerns” about oil demand growth in its latest monthly report released yesterday.
Brent futures have declined nearly 10 per cent since OPEC+ announced a new round of production cuts on November 30. OPEC+ includes OPEC and allies such as Russia.
