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Oil Falls In Skittish Trade as Powell Avoids Rate-Cut Signals - BLOOMBERG

JULY 10, 2024

(Bloomberg) -- Oil dropped in a session marked by wild price swings as traders dissected Federal Reserve Chair Jerome Powell’s testimony to Congress.

West Texas Intermediate fell 1.1% tp settle below $82 a barrel as thin liquidity exacerbated price swings within a roughly $1 range. Earlier, prices traded above $82 a barrel after Powell said the labor market has “cooled considerably,” but further comments that avoided sending signals about imminent rate cuts caused markets to give up previous gains.

Crude markets are in a “nervous trade”, said Dennis Kissler, senior vice president for trading at BOK Financial Securities. The lack of clarity when discussing future rate hikes left traders concerned about the possibility of interest rates being elevated for longer.

Adding to bearish sentiment, the oil hub of Houston made it through the worst of storm Beryl and reported progress on recovery efforts.

Meanwhile, Russia’s crude exports in the week to July 7 slumped the most since before the 2022 invasion of Ukraine, according to vessel-tracking data compiled by Bloomberg. There was no clear reason for the sudden weekly drop, but shipments fell from the major ports.

Forecasts for higher fuel consumption throughout the Northern Hemisphere’s summer have supported prices, though slumping supertanker earnings are a reminder of ongoing concerns about Chinese consumption.


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