Oil Up, with Potentially Aggressive U.S. Interest Rate Hikes Looms
2022.06.15 07:55
By Zhang Mengying
Investing.com – Oil was up on Wednesday morning in Asia amid concerns of uncertain economic outlook ahead of potentially aggressive U.S. interest rate hikes decisions.
Brent oil futures edged up 0.14% to $121.34 by 12:48 PM ET (4:48 AM GMT) and crude oil WTI futures edged up 0.15% to $119.11.
Tuesday’s U.S. crude supply data from the American Petroleum Institute showed a build of 0.736 million barrels for the week ended June 10.
Friday’s red-hot inflation data has raised the market expectations of an interest rate hike by 75 basis points, the largest in 28 years.
“An aggressively hawkish signal from the (U.S.) Fed may increase concerns of a global recession, which may dampen the demands of the energy market,” Singapore-based DailyFX analyst Leona Liu told Reuters.
“If the Fed announces a 75-basis-points hike tonight, oil prices may be notably weak against the dollar in the short term as a hawkish Fed may push investors to flow into the safe-haven dollar and hit risk-sensitive assets like oil.”
The new COVID-19 outbreaks in Beijing and the following curbs added worries about the second largest country’s oil demand.
The Organization of Petroleum Exporting Countries and allies (OPEC+) stuck to its forecast that world oil demand will exceed pre-pandemic levels in 2022 in its monthly report.
Investors now await crude supply data from the U.S. Energy Information Administration, due later in the day.
