ISLAMABAD (PEN) : Early in Friday’s trading session, crude oil futures experienced a decline, influenced by expectations of prolonged higher interest rates in Asia and the United States. Despite this, prices were supported by a decrease in U.S. oil inventories.
Brent futures for August delivery saw a minor drop of 11 cents, settling at $85.60 per barrel by 0013 GMT. Similarly, U.S. crude slipped by 9 cents to $81.20 per barrel.
On the economic front, Japan reported a 2.5% increase in core consumer prices year-on-year, indicating a growth trend from previous months and potentially paving the way for the country’s central bank to raise interest rates in the near future.
In the United States, recent data indicated a decline in new filings for unemployment benefits, suggesting ongoing strength in the job market. This robust employment scenario could prompt the Federal Reserve to maintain higher interest rates for an extended period.
The Energy Information Administration’s report on Thursday revealed a reduction in U.S. crude inventories by 2.5 million barrels for the week ending June 14, bringing the total stockpiles to 457.1 million barrels. This drawdown exceeded analysts’ expectations of a 2.2 million-barrel decrease. Additionally, gasoline inventories decreased by 2.3 million barrels to 231.2 million barrels, contrasting with forecasts of a 600,000-barrel increase.
Bob Yawger, director of energy futures at Mizuho in New York, noted that gasoline inventories showed a notable improvement, marking the first strong report of the summer driving season.
Overall, while concerns over higher interest rates weighed on oil prices, the supportive inventory data helped mitigate further declines in the market.
