September 19, 2024
New Delhi, India
WTI Crude Oil Prices
West Texas Intermediate (WTI) crude oil prices surged to a two-week high on Wednesday, nearing the $71 mark. This jump follows a recent pullback but continues the recovery from last week’s low of $64.75, the lowest level since May 2023.
The Federal Reserve’s decision to cut interest rates by 50 basis points on Wednesday has fueled optimism for economic growth and energy demand. This policy easing, along with a weaker US Dollar (USD), contributed to WTI’s upward movement.
Adding to the rally, escalating tensions in the Middle East, particularly after an explosion involving Hezbollah’s equipment, further supported the rise in crude oil prices.
Government data released on Wednesday showed a larger-than-expected draw in US crude inventories, although this was offset by builds in distillates and gasoline stockpiles, providing mixed signals for the market.
Global Demand Concerns May Cap Gains
Despite the positive sentiment, concerns about slowing global fuel demand could limit further gains in WTI prices. Both OPEC and the International Energy Agency (IEA) recently lowered their demand growth forecasts amid fears of a global economic slowdown, especially in China, the world’s largest oil importer.
Caution on Future Price Movements
Weaker Chinese macroeconomic data over the weekend has reinforced concerns about slowing growth in China, causing some traders to approach WTI’s upward trajectory with caution. Key US macroeconomic data, including Weekly Initial Jobless Claims and Existing Home Sales, are now being closely watched for further market direction.
WTI’s rise reflects broader market optimism, but ongoing concerns about global fuel demand and economic slowdowns may prevent any aggressive long-term price increases.
Also Read: US Fed Cuts Interest Rate by 50 bps for First Time in Four Years; Signals More Reductions in 2024
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