Oil extends gains after bullish US macro data raises Fed rate cut expectations; Brent nears $84
₹6,619 per barrel on the multi commodity exchange (MCX). The number of Americans filing new claims for unemployment benefits fell last week by 10,000 to a seasonally adjusted 222,000, the U.S. Labor Department said, pointing to both an underlying strength and a steadying of the labor market.
"Even though the jobless claims were low, the report was weak enough that it's going to allow the Fed to get in and cut," said John Kilduff of Again Capital LLC. "The strong employment trends do portend strong gasoline demand as we look out, even though it has been lackluster." U.S. consumer prices, meanwhile, were up less than expected in April in a boost to financial market expectations for a September cut to interest rates by the Federal Reserve, which could temper dollar strength and make oil more affordable for holders of other currencies.
Brent had touched an intra-day low of $81.05 on Wednesday - the lowest the front-month futures contract has traded since Feb. 26 - but recovered to about 0.5% higher on the day on mixed U.S. oil inventory data that has limited oil prices.
U.S. crude oil, gasoline and distillate inventories fell, reflecting a rise in both refining activity and fuel demand, Energy Information Administration (EIA) data showed. Crude inventories dropped by 2.5 million barrels to 457 million barrels in the week ended May 10, the EIA said, versus the 543,000 barrel consensus analyst forecast in a Reuters poll.
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