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02 March 2024

Oil prices above 92 dollars in Asian trade

By Agencies


Oil prices climbed higher in Asian trade Wednesday ahead of an expected fresh cut in US interest rates, dealers said.

Prices were also getting support from expectations that Opec will leave current production quotas unchanged when the 13-member oil cartel meets in Vienna Friday for a crucial meeting about its output levels, they said.

In morning trade, New York's main contract, light sweet crude for March delivery, rose 86 cents to 92.50 US dollars a barrel from 91.64 in late US trades Tuesday during floor trading on the New York Mercantile Exchange.

Brent North Sea crude for March delivery was 55 cents higher at 92.55 dollars a barrel.

Analysts expected the US Federal Reserve, the central bank, to cut interest rates again at the conclusion of its two-day policy meeting that began Tuesday.

A decision was expected Wednesday at about 1915 GMT.

The rate is currently 3.50 per cent after an emergency 0.75 percentage point cut last week in a move aimed at calming global financial markets roiled by fears of a widening US recession.

Energy traders are watching the Fed's moves closely because the United States is the world's biggest oil importer and a slowdown in US economic growth could dent energy demand.

"Equity market movements, economic growth expectations and speculation over future monetary policy measures are continuing to set the tone of trading in the market," Barclays Capital analyst Kevin Norrish said earlier.

Oil prices have recently reacted to gyrations on global equity markets, and are off their early January historic highs of 100.09 dollars for New York's light sweet crude and 98.50 dollars for Brent. (AFP)