Crude oil starts mixed – Fed and OPEC statements bring mixed sentiment on Monday

Oil prices fluctuated Monday as investors balanced expectations that OPEC will cut production to support prices. Federal Reserve Chairman Jerome Powell expressed concerns that the United States will experience slow growth “at times.”

  • WTI crude rose 2 cents to $93.08 a barrel.
  • Brent crude fell 27 cents, or 0.3%, at $100.72 a barrel.

In a speech last Friday, Powell said controlling inflation would likely require a period of growth that is below sustainable trends. And that will cause pain for households and businesses and shake up the stock market.

The dollar index continued to rise on Monday, reaching 109.16 in early trading, up 0.3%. A stronger dollar affects the price of oil, as it makes crude oil more expensive for buyers of other currencies.

However, oil prices have been boosted by talks from Saudi Arabia and other OPEC and OPEC+ members that they may cut production to balance the market.

The United Arab Emirates agrees with Saudi Arabia’s thinking on export policy. Oman’s Oil Ministry also said it supports OPEC+ efforts to stabilize the market.

OPEC will consider production cuts to offset the increase in Iranian output if oil sanctions are lifted and Tehran agrees to resume a nuclear agreement.

The demand side is also supporting prices. This is partly because higher natural gas prices in Europe have prompted power generators and industrial users to switch to diesel and fuel.

The Spot Market is Open

Monday, August 29, 2022

Energy
Updated at
USD
Price

Change

%Change
Crude Oil
13.50

93.58

+0.52

+0.56%

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