Oil prices are mixed on Wednesday amid the rising value of the US dollar, expected US economic data and December meeting minutes of the Fed’s Federal Open Market Committee (FOMC).
International benchmark crude Brent traded at $75.92 per barrel at 10.37 a.m. local time (0737 GMT), a 0.03% gain from the closing price of $75.89 a barrel in the previous trading session on Tuesday.
The American benchmark West Texas Intermediate (WTI) traded at the same time at $70.32 per barrel, down 0.08% from Tuesday’s close of $70.38 per barrel.
The US dollar recorded a steep increase during the first trading day of the year on Tuesday ahead of key US economic data and the Federal Reserve’s (Fed) Federal Open Market Committee (FOMC) December meeting minutes due later in the day. Markets are also awaiting data on US November job openings and Labor Turnover Survey.
When US dollar appreciates, it discourages the oil traders holding other currencies from buying a more expensive crude oil.
The Fed last made a rate hike of 25 basis points on July 26, after raising interest rates by a total of 525 basis points in 11 meetings from March 2022 to July 2023 to fight record inflation, the highest level in more than 40 years seen last summer.
Investors are also eyeing US crude oil inventories data to provide direction on the demand trajectory in the US, the world’s largest oil consuming country.
The American Petroleum Institute will issue forecasts of the newest data on the country’s crude oil stockpiles during the day, while the US Energy Information Administration will reveal official data on Thursday.
The decline in crude oil stocks indicates improved demand in the US, which should push prices higher, whereas expanding stockpiles tend to force prices down.
