Oil down on Thursday

Oil prices declined in Asian trade on Thursday after the US Federal Reserve signalled a slower pace of interest rate cuts in 2025, raising concerns about economic growth and fuel demand. Brent futures fell 27 cents, or 0.4 per cent, to $73.12 a barrel, while US West Texas Intermediate crude dropped 39 cents, or 0.6 per cent, to $70.19.

The declines reversed most of Wednesday’s gains, which were driven by a drop in US crude stocks and the Fed’s expected 25-basis-point interest rate cut. However, the Fed’s projection of two quarter-point rate cuts in 2025, lower than 4 cuts forecasted last September, led to market concerns over reduced economic activity and weaker oil demand.

Despite a slight increase in demand in early December, JP Morgan analysts reported global oil demand growth for the month to be 700,000 barrels per day lower than expected.

Meanwhile, US crude stocks fell by 934,000 barrels in the week to Dec. 13, less than analysts’ forecasted 1.6 million-barrel drop, though rising US crude exports provided market support.

Attribution: Reuters

Subediting: M. S. Salama