Oil prices extend gains on signs of stronger US demand
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The news: Global oil prices rose as US demand showed signs of strengthening, as slower-than-expected inflation data heightened the possibility of an interest rate cut, Reuters reported.
The numbers: Brent futures were up 0.39%, or 42 US cents, to USD83.07 ($124.32) a barrel by 12:04pm AEST. US West Texas Intermediate crude, the other key global benchmark, was up 0.45%, or 43 US cents, to USD78.98 a barrel.
Despite these gains, energy was the only ASX sector in the red, down 0.24%. Oil majors remained relatively flat, with Woodside Energy lowering 0.2%, Santos down 0.32%, and Beach Energy losing 1.84%. Origin Energy was up 1.86%.
The context: US consumer prices rose less than expected in April, boosting hopes for a September rate cut, and increasing chances of a hike in demand for oil.
Meanwhile, US crude oil, gasoline and distillate inventories fell last week, according to the Energy Information Administration (EIA), showing a rise in refining activity and fuel demand.
Crude inventories fell 2.5 million barrels to 457 million barrels in the week, versus the 543,000 barrel consensus analyst forecast in a Reuters poll.
The source: Reuters
