Oil price today: Stocks temper gains as oil pares heavy losses, US data in focus
Stocks mostly rose Wednesday following a plunge in oil prices the previous day, though the gains were tempered by a slight recovery in the commodity in Asian trading.
Oil prices followed a sharp decline on Tuesday as investors remained hopeful for a resolution to the US-Iran conflict, which could reopen the Strait of Hormuz. However, the commodity showed a slight recovery in Asian trading, limiting the gains on Wall Street. The Saudi Arabia's restoration of about half the capacity of its East-West pipeline following drone attacks provided a significant boost.
Additionally, the Trump administration ordered the release of more oil from US emergency reserves. Brent crude dropped over two percent, while West Texas Intermediate fell more than three percent, ending the day at $103.73 and $3.64 per barrel respectively. Investors focused on upcoming US inflation data, which could influence the Federal Reserve's decision on interest rates.
Chinese factory activity showed growth for the first time since June, but this was not enough to impact oil prices significantly. Despite the decline in crude prices, the anticipation of a strong US dollar and higher interest rates due to tech firms' investments in AI has driven a strong repricing in crude. Investors are eagerly awaiting the release of personal consumption expenditure data for October, which could sway the Federal Reserve's decision at its October policy meeting.
Fed officials are emphasizing the importance of bringing down inflation prices, and New York Fed chief John Williams hinted that a second rate hike may not be necessary this year, providing a glimmer of hope for policymakers.
Written by urgent.news from IOL's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
