Oil prices surge over 3.5 percent amid easing demand concerns, speculation of Fed rate cut
Date
8/11/2024 6:03:23 AM
(MENAFN) Oil prices saw a significant weekly rise of over 3.5 percent as concerns about demand began to abate, bolstered by positive economic data. This price increase was also supported by signals from U.S. Federal Reserve officials hinting at a potential interest rate cut as soon as September. In addition, ongoing apprehensions regarding the expansion of conflicts in the Middle East continued to threaten supply stability, contributing further to the surge in oil prices.
By Friday, brent crude futures had risen by 50 cents, reaching USD79.66 per barrel, while U.S. West Texas Intermediate (WTI) crude futures increased by 65 cents to USD76.84 per barrel. Over the course of the week, Brent crude saw a notable gain of over 3.5 percent, and WTI crude experienced a rise of more than 4 percent. This upward trend in prices was fueled by optimistic remarks from three Federal Reserve policymakers who expressed growing confidence in decreasing inflation rates, which could pave the way for interest rate cuts.
Furthermore, data showing a larger-than-expected decrease in new unemployment claims in the U.S. suggested that worries about a weakening labor market and potential recession might be overstated. This data, combined with the Fed's signals, contributed to the positive momentum in oil prices, alleviating some of the demand concerns and supporting the overall increase in market values.
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