Growing concern about the risks of an unprecedented US default
Oil prices rose in early Asian trading on Thursday, after the impact of strong fuel demand in the United States outweighed fears that the world’s most oil-producing and consuming country might default on its debt.
By 04:40 GMT, Brent crude futures rose 63 cents, or 0.82%, to $77.04 a barrel. US crude futures rose 57 cents to $73.13.
The latest US data showed an increase in consumer prices in April, which increases the possibility that the Federal Reserve (the US central bank) will maintain high interest rates, which may lead to a reduction in demand for oil. The pressure of rising global interest rates on oil prices in the past months, with traders worried about a recession, according to Reuters.
However, signs of strength in fuel demand emerged in the US.
US gasoline inventories fell by 3.2 million barrels last week, much more than the 1.2 million barrels expected by analysts. Yesterday, Wednesday, data from the US Energy Information Administration showed a drop in distillate stocks.
The demand for jet fuel in the United States rose to the highest level since December 2019.
Meanwhile, detailed talks began regarding raising the US government’s debt ceiling of $31.4 trillion, with Republicans sticking to their insistence on spending cuts.
The standoff has spooked investors, as Wall Street worries about the risk of an unprecedented debt default.
2023-05-11 05:03:00
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