Crude Oil Prices Edge Higher on Demand Optimism
Crude oil prices edged high in the global commodity market on declining American crude inventories, signaling a higher demand outlook in the U.S. Also supporting the uptick are the strong market expectations for a Federal Reserve (Fed) rate cut and a slide in the US dollar index.
Brent crude was trading at $67.02 per barrel, up by 0.6% from the previous session’s close of $66.57. US West Texas Intermediate (WTI) crude rose 0.6% to $64.04 per barrel, from $63.63 in the previous session. US president Donald Trump signed a decree introducing an additional 25% tariff on Indian imports, in response to India continuing its oil purchases from Russia on August 6.
The measure will take effect in 21 days, with certain goods to be exempt during the transition period. Other countries importing Russian oil may also face similar actions, depending on further assessments.
The new sanction, which targets Russia, the world’s second-largest crude oil producer after the US, has raised concerns among market participants over potential disruptions in global supply, pushing prices higher.
Trump also announced plans to impose nearly 100% tariffs on imported chips and semiconductors, while US b-based manufacturers would be exempt. The announcement further supported the upward trend in oil prices.
Experts noted that while trade concerns related to Trump’s tariff decisions persist, the possibility of exemptions could support economic activity and fuel demand, adding upward pressure on oil prices.
Expectations for an imminent interest rate cut by the Fed are also keeping global risk appetite strong. Money market pricing suggests a rate cut in September is considered almost certain. A low interest rate environment tends to weaken the US dollar against other currencies, which can increase oil demand and in turn lift prices.
Meanwhile, data pointing to a drop in US commercial crude oil inventories, reinforcing perceptions of strong demand in the world’s largest oil consumer, also contributed to the price increase. Commercial crude stocks fell by 3 million barrels last week, dropping to 423.7 million barrels according to the US Energy Information Administration (EIA).
The market had expected an increase of around 200,000 barrels. The country’s daily crude oil production also declined by 30,000 barrels to 13.284 million barrels during the same week. #Crude Oil Prices Edge Higher on Demand Optimism MTN Nigeria Exceeds N10tn in Post-Earnings Vibes, Public Offer Looms
