Oil Prices Hold Steady as Focus Shifts to Fed Policy Impact
Investing.com
Published Jul 08, 2019 08:36AM ET
Updated Jul 08, 2019 08:58AM ET
Investing.com - Oil prices held steady near the unchanged mark to start the week, as focus shifted from supply and demand to the outlook for monetary policy easing from the Federal Reserve.
New York-traded West Texas Intermediate crude futures dropped 9 cents, or 0.2%, to $57.42 a barrel by 8:32 AM ET (12:32 GMT), while Brent crude futures, the benchmark for oil prices outside the U.S., slipped 5 cents, or 0.1%, to $64.18
Barani Krishnan, senior commodity analyst at Investing.com, argued that “conflicting supply-demand signals have lately muddied the path for prices, particularly in oil,” and suggested that that leaves prices more exposed to extraneous variables such as Fed policy.
“A drop in interest rates would weaken the U.S. dollar and lift alternative assets such as commodities,” Krishnan said. “Conversely, a Fed stay would steady - or even strengthen -the greenback, weighing on oil and gold prices.”
Krishnan noted that the strong jobs report cast doubt over whether the Fed is ready to cut interest rates aggressively.
No fewer than 10 appearances from policymakers are scheduled for this week, the highlight being Fed Chairman Jerome Powell’s semiannual monetary policy report to Congress on Wednesday and Thursday.
Outside of the impact of policy moves on the dollar, tension in the Middle East continued to simmer in the background, supporting crude prices.
Iran admitted over the weekend that it had increased uranium enrichment beyond the purity threshold agreed in a nuclear deal that Washington pulled out of last year, according to Iranian news agency ISNA.
Speaking on Sunday, U.S. President Donald Trump warned that Tehran “better be careful” on the decision which he claims to be a step towards the development of nuclear weapons.
In other energy trading, gasoline futures fell 0.8% to $1.9145 a gallon by 8:34 AM ET (12:34 GMT), while heating oil declined 0.2% to $1.9007 a gallon.
Lastly, natural gas futures gained 0.2% to $2.423 per million British thermal unit.
Get The News You Want
Written By: Investing.com
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.