New York West Texas Intermediate (WTI) crude futures closed higher on Wednesday (March 22), supported by a weaker dollar. After the US Federal Reserve (Fed) raised interest rates by only 0.25% as expected, signaling an end to the interest rate hike cycle.
- The WTI crude oil contract is delivered in April. rose $1.23, or 1.8%, to settle at $70.90/barrel.
- The Brent crude oil contract (BRENT) is delivered in May. It was up $1.37, or 1.8%, at $76.69/barrel.
WTI crude oil futures closed at their highest level in a week or so since March 14, and have been rallying for three straight trading sessions as the dollar’s depreciation puts the dollar-priced crude oil futures. It is cheaper and more attractive to investors holding other currencies.
The dollar index, which measures the dollar’s movement once morest six major currencies in a basket of currencies. It fell to a 6-week low following the Fed raised its short-term interest rate by 0.25% to 4.75-5.00%, in line with market expectations. raise interest rates along with showing confidence in the US banking system
The Fed released its policy interest rate forecast (Dot Plot), which indicates that Fed officials expect the Fed to raise interest rates as high as 5.1% this year, suggesting that the Fed will only raise interest rates one more time following the Fed. In addition, the Fed is expected to cut interest rates by 0.8% in 2024 and 1.2% in 2025.
The market was also supported by a report from the US Government Energy Information Administration (EIA), which said gasoline inventories fell 6.4 million barrels last week. That was just 2 million barrels more than analysts had expected.
However, U.S. crude inventories rose 1.1 million barrels, beating analysts’ expectations for a 5.5 million barrel drop.
Investors keep an eye on the committee meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies. Or OPEC Plus on April 3, while news sources from the OPEC Plus group revealed that OPEC+ is likely to maintain its oil production policy by cutting output by 2 million barrels per day until the end of 2023 despite the recent banking crisis.
By InfoQuest News Agency (23 Mar. ’23)
Tags: WTI oil, crude oil, oil price
