Oil Prices Gain In Choppy Trading As Traders Assess Comments From Powell, Trump

Oil prices gained marginally in volatile trading on Wednesday as investors assessed the commentary by Federal Reserve Chair Jerome Powell as well as U.S. President Donald Trump's shift in stance around the Ukraine War.

Benchmark Brent crude prices rose 0.4% to $67.88 per barrel, while U.S. West Texas Intermediate prices also gained 0.3% cents to $63.64 per barrel at 5.10 a.m. ET. Retail sentiment on Stocktwits about the United States Oil Fund (USO) was in the 'bullish' territory at the time of writing.

Both benchmarks climbed by more than $1 a barrel on Tuesday as a deal to resume exports from Iraq's Kurdistan stalled, halting pipeline shipments of approximately 230,000 barrels per day of oil from the region to Turkey, following requests from two key producers for debt repayment guarantees. Pipeline flows have been stopped since March 2023.

Later in the day, President Donald Trump stated that Ukraine can reclaim all its territories, marking a reversal of his earlier stance, where he urged Kyiv to cede some of its territories to Russia. According to an AFP report, the Kremlin replied that there was“no alternative” for Russia than to continue its offensive on Ukraine that it launched in 2022.

Trump has already urged Europe to scale back their purchases of Russian energy and floated higher tariffs on the buyers of Russian oil, including Russia and India.

Separately, Federal Reserve Chair Jerome Powell hinted that the U.S. central bank could take a hawkish approach to interest rate cuts.“Near-term risks to inflation are tilted to the upside and risks to employment to the downside - a challenging situation. Two-sided risks mean that there is no risk-free path,” Powell said in a speech on Tuesday.

The U.S. dollar also advanced, capping some gains in oil prices. A stronger dollar makes the commodity more expensive for overseas buyers.

Oil traders are also keenly awaiting the weekly U.S. crude inventory data. According to a Reuters report, citing market sources, American Petroleum Institute figures showed U.S. crude and gasoline stocks fell, while distillate stocks rose last week.

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