(MENAFN- Trend News Agency)
Oil prices were little changed on Wednesday amid subdued
movements in the dollar, and as investors waited for more inventory
data for more clues on demand trends, trend reports with reference to reuters .
Brent crude futures rose by one cent to $83.70 a barrel at 0405
GMT, after gaining 3.3% in the previous session.
U.S. West Texas Intermediate (WTI) crude futures climbed by 15
cents to $77.29, after jumping 4.1% in the previous session.
Oil benchmarks are expected to retain support after Federal
Reserve Chair Jerome Powell sounded less hawkish on interest rates
than markets had expected, while the latest data showed U.S. crude
inventories fell despite earlier expectations of a climb.
'The improved risk sentiment in the aftermath of Fed Chair
Jerome Powell's comments, along with a weaker U.S. dollar, seem to
be tapped on for some upside in oil prices, after seeing a
lacklustre performance since end-January,' said IG's market analyst
Yeap Jun Rong.
'The reservation is that the overnight downside reaction in the
U.S. dollar has been more measured as compared to before,' said
Yeap, adding that any continued recovery in the dollar could still
serve as a headwind for oil prices.
The dollar index was down slightly on Wednesday, extending
losses after Powell's comments on Tuesday, making oil cheaper for
those holding other currencies.
With less aggressive interest rate hikes in the United States,
the market is hoping the world's biggest economy and oil consumer
can dodge a sharp slowdown in economic activity or even a recession
and avoid a slump in oil demand.
'I think we're in a reasonably balanced market,' said Westpac
senior economist Justin Smirk.
'If we have stronger than expected growth out of the developing
world, (oil) prices will be firmer and OPEC will have to step up
output. That's not our core view. We don't see a big surge in
demand,' he said.
Supporting the market, weekly inventory data from the American
Petroleum Institute industry group showed crude stocks fell by
about 2.2 million barrels in the week ended Feb. 3, according to
That defied expectations from nine analysts polled by Reuters,
who had estimated crude stocks grew by 2.5 million barrels.
However, gasoline and distillate inventories rose more than
expected, with gasoline stocks up by about 5.3 million barrels and
distillate stocks, which include diesel and heating oil, up by
about 1.1 million barrels.
The market will be looking to see if data from the U.S. Energy
Information Administration, due at 1530 GMT, confirms the decline
in crude stocks.