|
The
Federal Reserve decided against raising interest rates from
historic lows on Thursday, saying uncertainty about global
economic growth had forced its hand.
The oil market had mixed reactions to the decision, with
concerns about economic weakness sending commodities and
equities lower, but a fall in the dollar against other
currencies meant buying dollar-traded crude became cheaper.
"The perception of 'ZIRP (Zero Interest Rate Policy) forever'
should provide some underlying support to the commodity
complex," said Olivier Jakob, a strategist at Petromatrix, a
Swiss-based consultancy.
Brent crude <LCOc1> was down 15 cents at $48.93 a barrel at 1100
GMT, after touching an intraday high of $49.75. U.S. West Texas
Intermediate (WTI) crude futures <CLc1> were trading at $46.33 a
barrel, down 57 cents.
Brent was set to make its first weekly gain in three weeks,
hinting at a turn in momentum for a commodity that has declined
nearly 30 percent since spring.
Front-month U.S. crude futures have strengthened this week to
their firmest versus Brent since the early days of the U.S.
shale oil boom, knocking off 70 percent of their discount to the
global benchmark to around $2 per barrel.
Kuwait, a key member of the Organization of the Petroleum
Exporting Countries (OPEC), said on Thursday the oil market
would balance itself but that this would take time, indicating
support for the group's policy of defending market share despite
falling prices.
Other sources at OPEC backed this view, saying they expected oil
prices to rise by no more than $5 a barrel per year to reach $80
by 2020, with a slowing in rival non-OPEC production growth not
enough to absorb the current oil glut.
Iran's deputy oil minister Rokneddin Javadi was quoted as saying
the country would unveil new oil contracts in the coming weeks,
earlier than previously expected.
The prospect of sanctions-free Iran adding more barrels to an
already oversupplied market is fuelling bearish momentum. Javadi
also reiterated Iran's plans to regain its oil production share
once Western sanctions are removed.
(Additional reporting by Henning Gloystein in Singapore; Editing
by Dale Hudson)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
 |
|
