OTTAWA (dpa-AFX) - Crude oil futures settled higher on Wednesday after data from U.S. Energy Information Administration (EIA) showed large declines in gasoline and distillate stockpiles in the week ended March 2nd.
Rising possibility of an interest rate cut by the Federal Reserve in June, and prospects of increased oil demand in the U.S. contributed as well to the rise in oil prices.
Oil prices were also supported by Saudi Arabia's decision to raise prices for its flagship crude grade to Asia, and persisting geopolitical risks in the Middle East due to the deadlock in ceasefire talks between Israel and Hamas, and the ongoing attacks on Red Sea shipping.
West Texas Intermediate Crude oil futures for April ended higher by $0.98 or about 1.25% at $79.13 a barrel.
Brent crude futures settled at $82.96 a barrel, gaining $0.92 or about 1.12%.
Data from EIA showed crude oil stockpiles rose by 1.4 million barrels last week, less than an expected increase of 2.1 million barrels.
Gasoline stocks dropped by 4.5 million barrels last week, nearly three times the expected decline of 1.6 million barrels, while distillate stockpiles were down 4.1 million barrels in the week, substantially larger than an expected decline of 665,000 barrels.
Fed Chair Jerome Powell told the House Financial Services Committee that it will likely be appropriate for the Fed to begin lowering interest rates at 'some point this year,' although he reiterated officials need 'greater confidence' inflation is moving sustainably toward 2%.
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