ISLAMABAD
Crude oil prices lowered on Thursday, as oil markets have been under pressure over expectations the Federal Reserve will keep interest rates higher for longer.
As of 1225 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, shed $0.47 (-0.56 percent) to reach $83.13 a barrel. Similarly, the West Texas Intermediate (WTI), the main oil benchmark for North America, went down by $0.36 (-0.45 percent) to $78.87 a barrel.
Both benchmarks are headed for monthly losses, with Brent futures on track for a decline of more than 5 percent from last month, while WTI was poised for a slide of over 3 percent.
On the other hand, the price of Arab Light decreased by $0.76 (-0.87 percent) to reach $86.42 a barrel. Similarly, the price of Russian Sokol decreased by $0.85 (-1.08 percent) to $77.85 a barrel. On the other hand, the price for Opec Basket increased by $2.08 (+2.54 percent) to $84.00 a barrel.
Brent lost about 2 percent last week and WTI nearly 3 percent after the US Federal Reserve minutes showed some officials would be willing to raise interest rates further if it were deemed necessary to control stubbornly high inflation. The US Consumer Price Index inflation rose 3.4 percent on an annual basis in April, the Labour Department said this month.
Minutes from the central bank’s latest policy meeting, released on Wednesday, showed that policymakers are questioning whether the current interest rates are sufficient to curb persistent inflation.
On the supply side, the Opec+ alliance of oil producers is widely expected by analysts to extend voluntary output curbs of 2.2 million barrels a day into the second half of 2024. The group is set to meet on June 2.
Meanwhile on the local front, the government is likely to cut the price of petrol and high-speed diesel by another Rs5.3 and Rs4.1 per litre, respectively, for the first half of June 2024, providing a major relief to the masses.
The expected cut is in line with the decline in international prices. Price estimates till May 28, 2024 indicate that international petroleum product prices have eased, with the ex-refinery price of petrol now standing at about Rs184.59 per litre, down from Rs189.86 per litre in the previous fortnight.
