Oil falls ahead of the announcement of the US Federal Reserve’s decision on interest rates

2023-09-20 04:22:00

Oil field in Russia (Archyde.com)

Oil prices

Moving away from its highest levels in 10 months

Tokyo – Archyde.com

Published on: September 20, 2023: 08:22 AM GST Last updated: September 20, 2023: 09:21 AM GST

Oil prices fell, becoming further away from their highest levels in ten months, today, Wednesday, ahead of the announcement of the Federal Reserve’s decision regarding the interest rate, amid a state of uncertainty among investors regarding when interest rates will reach their peak and the extent of its impact on energy demand. .

Prices fell despite a larger-than-expected draw in US oil inventories and weak US shale oil production, indicating tighter crude supplies in the remainder of 2023.

Brent crude futures fell by slightly more than a dollar to $93.33 per barrel, and in the latest trading fell 80 cents, equivalent to 0.8%, to $93.54 per barrel by 03:10 GMT. Brent recorded $95.96 yesterday, Tuesday, its highest level since November.

US West Texas Intermediate crude futures fell 0.8%, or 75 cents, to $90.45 a barrel, after rising to a ten-month high of $93.74 a barrel the previous day.

Edward Moya, chief market analyst at the data and analysis company OANDA, said: “The pace of oil’s rise is calming down slightly as traders await a pivotal decision from the Federal Reserve.”

Moya added that the oil market is still “very tight” and will remain so in the short term.

Investors are awaiting a group of interest rate decisions from central banks this week, including the US Federal Reserve’s decision today, to assess expectations for economic growth and demand for fuel.

The Federal Reserve is largely expected to keep interest rates unchanged, but the focus will be on its policy path, which is unclear.

Oil prices rose in early trading on Wednesday, hovering near the highest level in ten months recorded in the previous session, as fears increased about the scarcity of crude supplies in the remainder of 2023 due to a larger than expected withdrawal from US oil stocks and weak shale oil production in the United States. United.