Oil prices rebounded on Thursday, rising 1 percent after a three-day decline, as risk appetite returned to financial markets following the U.S. Federal Reserve’s decision to keep benchmark interest rates steady. Brent crude futures rose by $1.28, or 1.51 percent, to $85.91 a barrel, while U.S. West Texas Intermediate crude futures gained $1.33, or 1.65 percent, to $81.77 a barrel.
The Fed’s decision to maintain its benchmark interest rate at 5.25 percent-5.50 percent, which was announced during its meeting on Wednesday, provided support for oil prices. Policymakers grappled with the question of whether financial conditions were already tight enough to control inflation or if further restraint was necessary due to the economy’s better-than-expected performance. U.S. inflation held steady at 3.4 percent in September for the third consecutive month.
Tamas Varga, an analyst at broker PVM, commented on the situation, stating, “There is still some way to go to achieve the 2 percent target, nonetheless monetary tightening has been working effectively and additional rate increase would probably do more harm than good.”
In Europe, manufacturing activity in the eurozone contracted further in October, with the Purchasing Managers’ Index (PMI) falling by 0.3 points to 43.1. A score below 50 indicates contraction. Despite this, the Bank of England is expected to maintain interest rates at their current levels in a meeting later on Thursday.
Investors are also keeping a close eye on the Middle East, as any developments in the region could disrupt oil supplies. The ongoing conflict around Gaza City between advancing Israeli tanks and troops and Hamas gunmen has heightened tensions and created uncertainty in the oil markets.
As oil prices recover, market participants are closely monitoring global economic indicators and geopolitical events to assess their impact on oil supplies and prices.
More detail via www.theepochtimes.com here… ( Image via www.theepochtimes.com )