Early trade sees an increase in oil prices as US inflation slows

13 Jul 2023 , 12:46 PM

Early Asian trading on Thursday saw an increase in oil prices as U.S. inflation and economic statistics raised optimism that the Federal Reserve may hold off on raising interest rates for the largest economy in the world.

Brent crude prices had risen $6 to $80.17 per barrel, while U.S. West Texas Intermediate crude futures had risen $4 to $75.79.

Consumer prices increased slightly in June, representing the smallest annual increase in more than two years, according to U.S. statistics released on Wednesday. Oil dealers are hoping it may be the last increase in interest rates because higher rates can stifle economic development and lower demand for oil.

While Russia will reduce exports by 500,000 bpd, top producer Saudi Arabia promised last week to extend a production cut of 1 million barrels per day (bpd) in August.

An element that could limit price increases was a report from the US Energy Information Administration that showed a considerably larger-than-expected increase in US oil stockpiles of around 6 million barrels last week.

Analysts had anticipated a significant decline in gasoline stock prices as people travelled for the holidays.

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