Oil prices rise on Libyan supply disruptions

29 Aug 2024 , 09:47 AM

Oil prices moved higher on Thursday after two sessions of losses, as supply fears about Libya resurfaced, but were offset by a smaller-than-expected fall in U.S. oil stocks, which dampened demand forecasts.

Brent crude prices rose 9 cents, or 0.11%, to $78.74 per barrel, while U.S. West Texas Intermediate crude futures were up 0.2%, at $74.67.

Both contracts fell more than 1% on Wednesday as data revealed that U.S. crude stocks fell by 846,000 barrels to 425.2 million last week, falling short of expert expectations in a Reuters poll for a 2.3 million reduction.

Some Libyan oilfields have ceased production amid a battle for control of the central bank, with one consultancy firm projecting output disruptions of 900,000 to 1 million barrels per day (bpd) for several weeks.

Expectations that the US central bank will begin cutting interest rates next month also boosted oil prices, with Federal Reserve Bank of Atlanta President Raphael Bostic indicating it may be time for cuts, with inflation falling further and unemployment rising faster than expected.

Lower interest rates make borrowing more affordable, which may enhance economic activity and raise demand for oil.

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