March,23(Agencies)– Oil prices fell Thursday after three sessions of gains as Federal Reserve Chair Jerome Powell highlighted banking sector credit risks for the world’s largest economy, while US crude stocks rose more than expected.
Brent crude futures fell 66 cents, or 0.9%, to $76.03 a barrel by 0420 GMT, while US West Texas Intermediate crude (WTI) dropped 74 cents, or 1.0%, to $70.16.
Both crude benchmarks settled on Wednesday at their highest close since March 14 after the dollar slid to a six-week low. “Economic risks were being flagged out in the Fed meeting, while higher-than-expected US crude oil stockpiles also dampened some optimism around demand outlook,” said Yeap Jun Rong, market strategist at IG.
However, the weakness in the dollar has been a bright spot in aiding to drive some resilience in oil prices, with some room left for upside in oil prices amid dip-buying seen at the start of this week, Yeap added.
The Fed raised interest rates by a quarter of a percentage point, while indicating that it was on the verge of pausing further increases in borrowing costs, amid recent turmoil in financial markets spurred by the collapse of two US banks.
Powell said on Wednesday that banking industry stress could trigger a credit crunch, with “significant” implications for an economy that US central bank officials projected would slow even more this year than previously thought.
Meanwhile, US crude oil stockpiles rose unexpectedly last week to their highest in nearly two years, latest data from the Energy Information Administration (EIA) showed. Crude inventories rose by 1.1 million barrels in the week to March 17 to 481.2 million barrels, the highest since May 2021.
Pakistan Rupee Exchange Rate