Oil rises after US leaders strike provisional debt deal

Author of the article: Reuters Arathy Somasekhar Published May 28, 2023  •  Last updated 2 hours ago  •  2 minute read HOUSTON — Oil prices slipped on Monday, as worries over further interest rate hikes that could curb energy demand trumped a tentative U.S. debt ceiling deal that would avert a default by the world’s top…
Oil rises after US leaders strike provisional debt deal

Author of the article:

Reuters

Arathy Somasekhar

Published May 28, 2023  •  Last updated 2 hours ago  •  2 minute read

HOUSTON — Oil prices slipped on Monday, as worries over further interest rate hikes that could curb energy demand trumped a tentative U.S. debt ceiling deal that would avert a default by the world’s top oil consumer.

Brent crude futures slipped 23 cents, or 0.3%, to $76.72 a barrel by 1640 GMT, while U.S. West Texas Intermediate crude was flat at $72.67 a barrel.

Financial Post Top Stories

Sign up to receive the daily top stories from the Financial Post, a division of Postmedia Network Inc.

By clicking on the sign up button you consent to receive the above newsletter from Postmedia Network Inc. You may unsubscribe any time by clicking on the unsubscribe link at the bottom of our emails or any newsletter. Postmedia Network Inc. | 365 Bloor Street East, Toronto, Ontario, M4W 3L4 | 416-383-2300

Trade was expected to remain subdued on Monday because of UK and U.S. public holidays.

“The euphoria of the debt deal is wearing off as concern mounts for another rate hike by the Fed in June,” brokerage Liquidity Energy LLC wrote in a note.

THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY

Subscribe now to read the latest news in your city and across Canada.

  • Exclusive articles by Kevin Carmichael, Victoria Wells, Jake Edmiston, Gabriel Friedman and others.
  • Daily content from Financial Times, the world’s leading global business publication.
  • Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.
  • National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.
  • Daily puzzles, including the New York Times Crossword.

Subscribe now to read the latest news in your city and across Canada.

  • Exclusive articles by Kevin Carmichael, Victoria Wells, Jake Edmiston, Gabriel Friedman and others.
  • Daily content from Financial Times, the world’s leading global business publication.
  • Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.
  • National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.
  • Daily puzzles, including the New York Times Crossword.

Create an account or sign in to continue with your reading experience.

  • Access articles from across Canada with one account.
  • Share your thoughts and join the conversation in the comments.
  • Enjoy additional articles per month.
  • Get email updates from your favourite authors.

U.S. President Joe Biden and House of Representatives Speaker Kevin McCarthy over the weekend forged an agreement to suspend the $31.4 trillion debt ceiling and cap government spending for the next two years. Both leaders expressed confidence that members of the Democratic and Republican parties will support the deal.

Still, analysts saw any boost in oil prices from it as short-lived, with earlier gains in the session lost.

Markets are now pricing in a roughly 50-50 chance that the Fed raises rates by another 25 basis points at its June 13-14 meeting, up from an 8.3% chance predicted a month ago, according to CME’s FedWatch Tool.

At its last policy meeting on May 2-3, the Federal Reserve signaled it was open to pausing its most aggressive rate-hiking cycle since the early 1980s in June.

“Higher U.S. rates are a headwind for crude oil demand,” IG Sydney-based analyst Tony Sycamore said.

The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, known as OPEC+, are due to meet on June 4.

Saudi Energy Minister Abdulaziz bin Salman warned short-sellers betting oil prices will fall to “watch out,” in a possible signal that OPEC+ may further cut output.

However, comments from Russian oil officials and sources, including Deputy Prime Minister Alexander Novak, indicate the world’s third-largest oil producer is leaning towards leaving output unchanged.

“Traders have been left a little confused as to what we can expect,” said Craig Erlam, senior markets analyst at OANDA.

“It may be that Saudi Arabia wants to keep traders on their toes, but to make these comments and not follow through could be perceived as weak and see prices drift lower again,” Erlam said. (Additional reporting by Noah Browning in London, Florence Tan in Singapore and Mohi Narayan in New Delhi; Editing by David Holmes, Leslie Adler and John Stonestreet)

Read More

Total
0
Shares
Leave a Reply

Your email address will not be published.

Related Posts
Revitalist Appoints Chief Operating Officer and Enters Into Network Agreement for Specialty Providers With CoreChoice
Read More

Revitalist Appoints Chief Operating Officer and Enters Into Network Agreement for Specialty Providers With CoreChoice

Author of the article: Published Mar 30, 2023  •  Last updated 13 hours ago  •  2 minute read VANCOUVER, British Columbia — Please replace the release with the following corrected version due to multiple revisions. The updated release reads: Financial Post Top Stories Sign up to receive the daily top stories from the Financial Post, a…
Sri Lanka confident of not defaulting on its debt, says finmin
Read More

Sri Lanka confident of not defaulting on its debt, says finmin

Author of the article: Reuters Uditha Jayasinghe COLOMBO — Sri Lanka is confident of not defaulting on its debt repayments and will work on gradually improving the quality of its foreign exchange reserves, finance minister Basil Rajapaksa said on Saturday, a day after presenting the 2022 annual budget. The government will reduce its budget deficit…
Odey Sacked From His Hedge Fund Firm After Assault Allegations
Read More

Odey Sacked From His Hedge Fund Firm After Assault Allegations

Odey Asset Management has removed its founder Crispin Odey from the firm’s partnership in a stunning turn of events for the famed hedge fund manager who is facing fresh sexual assault allegations. Author of the article: Bloomberg News Nishant Kumar Published Jun 10, 2023  •  Last updated 4 hours ago  •  3 minute read 0pxi)efg}osp0)yjzzhybra1_media_dl_1.png Source:…