NEW YORK :Oil prices settled close to unchanged on Thursday, pressured by a forecast for ample supply in the oil market but supported by rising expectations of a Federal Reserve interest rate cut.
Brent crude futures settled down 11 cents, or 0.15 per cent, to $73.41 a barrel. U.S. West Texas Intermediate crude futures were down 27 cents, or 0.38 per cent, at $70.02.
The International Energy Agency made a slight upward revision to its demand outlook for next year but still expected the oil market to be comfortably supplied. On Wednesday, OPEC cut its demand growth forecast for 2024 for the fifth straight month.
“If you look at the actual data, the IEA is saying that the glut they predicted should be happening right this minute,” said Phil Flynn, analyst at Price Futures Group. Global oil inventories fell by 39.3 million barrels in October as low refinery activity coincided with a rise in global oil demand, data from IEA showed.
In the U.S., inflation rose slightly in November, in line with economists’ expectations. Investors broadly expect the Fed to cut rates again, feeding optimism about economic growth and energy demand.
“The inflation report creates a lot of comfort. It could have been better, but it seems to be low enough for the Fed to reduce rates at the next meeting,” said Bjarne Schieldrop, chief commodities analyst at SEB.
In the world’s top oil consumer, the U.S., gasoline and distillate inventories rose by more than expected last week, Energy Information Administration data showed.
Global oil demand rose at a slower than expected rate this month but has remained resilient, JPMorgan analysts said in a note.
Chinese crude imports grew annually for the first time in seven months in November, up more than 14 per cent from a year earlier.
In the Middle East, Iran agreed to tougher monitoring by the U.N. nuclear watchdog at its Fordow site dug into a mountain after it greatly accelerated uranium enrichment to close to weapons grade there, putting pressure on prices.
