The weakening of the dollar after the meeting of the US Federal Reserve System (FRS) and optimistic demand expectations in the hope of China’s economic recovery support quotes.
The price of April futures for Brent crude rose by 0.87% to $83.56 per barrel, March futures for WTI grew by 1.06% to $77.22.
The dollar index (the exchange rate against a basket of currencies of six US trading partners) fell by 0.33% to 100.88 points. A weaker dollar is supporting demand for commodities, including oil, making them more affordable to buy in other currencies.
"Prices are finding support from a weakening US dollar,” Ravindra Rao, head of commodities research at Kotak Securities Ltd. in Mumbai, told Bloomberg. However, "with all the bearish factors it seems difficult for oil to stay higher,” he said, citing expanding inventories, interest rate hikes, and slowdown concerns
On February 1, the FRS expectedly raised the base interest rate by 25 basis points - up to 4.5-4.75% per annum. The head of the regulator, Jerome Powell, said that the Fed considers it possible to return inflation to the target 2% without a significant slowdown in the economy.
At the same time, traders remain optimistic about the prospects for oil demand in anticipation of the economic recovery of China, one of the world’s largest importers and consumers of this raw material.
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