Oil futures were lower Thursday, losing ground a day after the Federal Reserve delivered another quarter-point interest rate hike.
Price action
-
West Texas Intermediate crude for May delivery
CL00,
-0.44% CLK23,
-0.44%
fell 48 cents, or 0.7%, to $70.42 a barrel on the New York Mercantile Exchange. -
May Brent crude
BRN00,
-0.31% BRNK23,
-0.31%
was down 35 cents, or 0.5%, at $76.34 a barrel on ICE Futures Europe. -
Back on Nymex, April gasoline
RBJ23,
+0.35%
fell 0.2% to $2.589 a gallon, while April heating oil
HOJ23,
-0.55%
dropped 0.8% to $2.718 a gallon. -
April natural gas
NGJ23,
+2.40%
rose 0.8% to $2.188 per million British thermal units.
Market drivers
Crude prices ended higher Wednesday after the Federal Reserve delivered a quarter-point rate hike, as expected. The Fed’s forecast showed policy makers expect just one more rate increase this year.
Crude has bounced back somewhat since tumbling last week to a 15-month low on fears that trouble in the banking sector could lead to a significant economic downturn.
“While no one can say with confidence that a banking crisis has been averted, there is growing confidence that the actions taken by central banks, regulators, and governments have significantly reduced the odds of one, particularly a severe scenario, and that is ultimately good for the economy and crude demand,” said Craig Erlam, senior market analyst at Oanda, in a note.
But Brent and WTI “remain below the range lows that preceded the selloff and have even run into resistance around those lows over the last couple of days. A move back above here may suggest confidence is returning while a failure to do so may indicate some more permanent damage to expectations,” he wrote.
