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HomeLatestOil prices in Asian trade showed a slight increase
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Oil prices in Asian trade showed a slight increase

This article reports that oil prices in Asian trade showed a slight increase on Friday, heading towards a positive conclusion for the week. This upward movement is attributed to expectations of tightened supplies and ongoing geopolitical tensions in the Middle East. However, the gains were modest as traders awaited crucial U.S. inflation data, which could offer insights into the trajectory of interest rates.

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At 20:54 ET (00:54 GMT), Brent oil futures edged up 0.4% to $89.32 per barrel, while West Texas Intermediate crude futures also increased by 0.4% to $83.86 per barrel. The decline in the dollar, following weak U.S. economic growth data, provided some support to oil prices.

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For the week, Brent prices were up approximately 2%, and WTI prices were expected to rise around 0.5%. This rise is attributed to recent data indicating a greater-than-expected reduction in overall U.S. inventories, signaling some tightness in global oil markets.

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Persistent concerns regarding potential disruptions to Middle East supplies persisted, particularly amidst escalated Israeli strikes against Gaza. Although a conflict with Iran did not materialize, the Israel-Hamas tensions showed little signs of abating. Additionally, the U.S. was poised to provide further military assistance to Israel, amplifying risk premiums for oil prices amidst worries of weaker demand and a slowing global economy.

Despite softer-than-anticipated U.S. gross domestic product data, which raised concerns about slowing demand in the world’s largest fuel consumer, oil prices continued to rise. The growth was under pressure from persistent inflationary pressures and high interest rates. Attention was now focused on the upcoming Personal Consumption Expenditures (PCE) price index data, expected later on Friday. This reading, being the Federal Reserve’s preferred inflation gauge, is likely to influence the central bank’s stance on interest rates.

Although there were earlier expectations of interest rate cuts by the Fed as soon as June, traders have recently adjusted their positions, leading to some weakness in oil prices.

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