Higher oil prices end a two-week losing skid

As a result of in-line inflation figures and a strengthening dollar amid ongoing geopolitical tensions, oil prices ended a two-week losing run on Friday by closing higher. Futures for Brent oil increased by 0.3% to $89.85 per barrel, while West Texas Intermediate oil increased by 0.4% to $89.38 per barrel. By projections, PCE inflation increases.

The U.S. inflation rate rose 0.3% last month, bringing the 12-month total through March to 2.7%, against economists’ projections of a 2.6% increase. This news caused the dollar to soar. One of the inflation indicators that the US Central Bank monitors to meet its 2% objective is the PCE price index. The rig count for Baker Hughes has dropped by the most since November.

According to data released on Friday by energy services company Baker Hughes, the number of oil rigs in operation in the United States dropped from 511 to 506, which represents the worst weekly reduction since November.

The amount of crude oil produced in the United States each day in the week ending April 19 remained constant at 13.1 million barrels. Recent sessions saw price increases as data revealed that overall U.S. inventories decreased more than anticipated over the previous week, suggesting some tightness in the world’s oil markets.

Because of this, there was still some risk premium for oil prices, which helped them weather worries about declining demand and slowing global growth. However, due to traders pricing out some risk premium from crude due to the lack of an immediate escalation in the Iran-Israel confrontation, oil prices were still trading significantly below their five-month highs set earlier in April.

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