Oil prices rise amid supply concerns, mixed inventory data

(MENAFN) On Thursday, oil prices saw a modest increase after experiencing losses in the previous sessions. Brent crude futures rose by 9 cents, or 0.11 percent, reaching USD78.74 per barrel, while U.S. West Texas Intermediate (WTI) crude futures increased by 15 cents, or 0.2 percent, to USD74.67 per barrel. This uptick came despite a smaller-than-expected decline in U.S. crude inventories, which fell by 846,000 barrels to 425.2 million barrels last week, falling short of analysts' projections of a 2.3-million-barrel reduction.

The rise in oil prices was partly driven by renewed concerns over supply disruptions from Libya. Geopolitical tensions and internal struggles in Libya, where some oil fields have halted production due to a power struggle over the central bank, have raised worries about potential disruptions. One consultancy estimated that Libya could lose between 900,000 and 1 million barrels per day of production for several weeks. This situation is contributing to market anxiety and is expected to limit potential declines in oil prices.

Furthermore, market sentiment was buoyed by expectations of a potential interest rate cut by the U.S. Federal Reserve. Atlanta Federal Reserve President Raphael Bousik indicated that with falling inflation and rising unemployment, it might be appropriate to consider cutting interest rates, which could support oil prices by fostering a more favorable economic environment. 

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