Singapore, Feb 8 (BNA): Oil prices were little changed on Wednesday amid weak moves in the dollar, as investors await more inventory data for more clues on demand trends.
Brent crude futures rose 1 cent to $83.70 a barrel at 0405 GMT, after rising 3.3% in the previous session, Reuters reported.
US West Texas Intermediate crude futures rose 15 cents to $77.29, after jumping 4.1 percent in the previous session.
Oil standards are expected to hold support after Federal Reserve Chairman Jerome Powell appeared less hawkish on interest rates than markets had expected, while recent data showed a drop in US crude inventories despite earlier expectations of a rise.
Market analyst at IG Yeap said: “The improved sentiment towards risk in the wake of Fed Chair Jerome Powell’s comments, along with a weaker US dollar, appears to have been exploited for some bullishness in oil prices, after experiencing a lackluster performance since the end of January. “. John Rong.
“The caveat is that the overnight negative reaction in the US dollar was more calculated than it used to be,” Yip said, adding that any sustained recovery in the dollar could remain a headwind for oil prices.
The dollar index fell slightly on Wednesday, extending losses after Powell’s comments on Tuesday made oil cheaper for those holding other currencies.
With less interest rate increases in the United States, the market is hopeful that the world’s largest economy and oil consumer will be able to avoid a sharp slowdown in economic activity or even a recession and avoid a decline in oil demand.
“I think we’re in a reasonably balanced market,” said Justin Smirk, chief economist at Westpac.
“If we have stronger than expected growth from the developing world, (oil) prices will improve and OPEC will have to increase production. This is not our fundamental view. We don’t see a significant increase in demand,” he said. .
In support of the market, weekly inventory data released by the American Petroleum Institute industry group showed that crude inventories fell by about 2.2 million barrels in the week ending February 3, according to market sources.
This was contrary to the expectations of nine analysts polled by Reuters, who estimated the growth of crude inventories by about 2.5 million barrels.
However, gasoline and distillate inventories rose more than expected, with gasoline inventories rising by about 5.3 million barrels and distillate inventories, which include diesel and heating oil, by about 1.1 million barrels.
The market will be looking to see if the US Energy Information Administration data due at 1530 GMT confirms the decline in crude inventories.