Oil steadies on Fed commentary, EIA data

Oil steadies on Fed commentary, EIA data

After rallying around 7% over the past three sessions, Bloomberg oil steadied in Asia as investors evaluated the latest commentary from Federal Reserve officials and mixed Energy Information Administration data.

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West Texas Intermediate futures traded near $78 a barrel after closing almost 2% higher on Wednesday. There are a number of Federal Reserve speakers who reinforced the idea that interest rates will need to keep climbing to combat inflation, putting concerns about a possible drag on demand back in focus.

The EIA report showed that refinery utilization rose to the highest since December, while crude stockpiles at the storage hub in Cushing, Oklahoma, increased to the largest since July 2021. Fuel inventories expanded more than expected.

Since the beginning of the year, the price of crude has suffered a period of choppy trading as investors look for signs of a rebound in Chinese demand, which some predict will drive prices above $100 a barrel. There are key timespreads signaling a tight market after recent disruptions to Norwegian and Azerbaijani flows.

Warren Patterson, Singapore-based head of commodities strategy at ING Groep NV, said participants are waiting for clearer signals on how Chinese demand and Russian supply evolve. In the months to come, the Fed policy will be in effect, adding even more uncertainty to the oil market and risk assets. None of the skies look gloomy for Big Tech's Cloud Ambitions.