BUSINESS-ECONOMY
Oil prices nudged higher as signs of another inventory draw in the US offset concerns on the timeline for Federal Reserve interest-rate cuts following Chair Jerome Powell's testimony. Oil prices nudged higher as signs of another inventory draw in the US offset concerns on the timeline for Federal Reserve interest-rate cuts following Chair Jerome Powell's testimony. Brent crude hovered close to $85 a barrel from a slide of more than 3 per cent in the previous three sessions, and West Texas Intermediate well below $82. The American Petroleum Institute stated that the US crude stockpiles had a drop of 1.92 million barrels for the last week, with a big draw at the key Cushing, Oklahoma hub, according to sources with knowledge of the data. This comes after a more than 12 million-barrel plunge in stockpiles the prior week. Despite recent volatility, oil prices are still easier for the year to date, underpinned by OPEC+ production cuts allied to expectations of easier monetary policy in the US. Powell said on Tuesday he was watching labour market weaknesses closely, but more evidence is needed of a slowdown in inflation before cutting borrowing costs. This subdued crude trading, in particular, has weighed on measures of volatility. Brent's implied volatility—a forecast of likely movement in oil futures based on options pricing—is near its lowest level in about six years. Traders now Await the monthly report from the Organization of the Petroleum Exporting Countries, due later in the day, which is expected to shed more light on the global market outlook. A similar report by the International Energy Agency is due tomorrow. To sum up, oil prices inched up, with US crude inventories trimming a bit of the excess and supported by the broader market, underpinned by OPEC+ supply cuts and possible shifts in US monetary policy. The forthcoming reports from OPEC and IEA will have wide attention for further signs of the trend. None
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