Oil Prices Rise after US Passes Debt Ceiling Bill and Limits Government Spending

2023-06-01 11:36:31

AA / Ankara / Zeynep Beyza Kilic

Oil prices rose in morning trading on Thursday following the passage of legislation that would raise the US debt ceiling and limit government spending in a bid to reduce the US federal deficit.

International benchmark Brent oil traded at $73.34 a barrel at 9:52 a.m. local time (0652 GMT), up 1.02% from Friday’s closing price. who had set the price per barrel at 72.60 dollars.

The price of the American benchmark West Texas Intermediate (WTI) barrel, for its part, traded at 68.75 dollars a barrel, with an increase of 0.97% compared to the closing price on Friday which was 68 $.09 a barrel.

The United States House of Representatives on Wednesday passed a bill to avoid catastrophic default on the national debt. The bill, which suspends the $31.4 trillion limit on federal government borrowing for two years, until January 2025, must now be approved by the US Senate.

President Joe Biden has urged the Senate to pass the bill as soon as possible, so he can sign it into law.

The debt ceiling was reached last January, but the Treasury Department has taken steps to ensure that the United States continues to meet its maturities.

From another perspective, the American Petroleum Institute announced that it expects US oil reserves to increase by 5.20 million barrels.

Markets are now awaiting official data from the US Energy Information Administration (EIA), which is expected later today.

Pending the OPEC meeting, scheduled for June 4, producing countries should opt for their new oil production policy, arousing the attention and caution of investors and brokers.

While Saudi Arabia and Russia, two major members of OPEC+, had given mixed signals regarding the increase in restrictions on oil production, analysts do not anticipate a significant change in production strategy. during the next meeting.

* Translated from English by Mounir Bennour.

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