Officials from the central bank of the United States have expressed support for higher and longer interest rates, leading to a decline in crude oil prices of nearly $1 per barrel on Friday. Brent crude futures closed at $82.79 per barrel, down $1.09 or 1.3%. West Texas Intermediate crude in the United States closed at $78.26 per barrel, falling $1.00 or 1.3%.
Lorie Logan, president of the Federal Reserve Bank of Dallas, stated on Friday that it remains unclear whether monetary policy is tight enough to lower inflation to the Fed's target level of 2%. Raphael Bostic, president of the Federal Reserve Bank of Atlanta, also mentioned that the current monetary policy could slow down inflation, allowing the Fed to start reducing policy interest rates by a quarter percentage point in 2024, although this would not begin until the end of the year.
The strengthening of the dollar has made commodities priced in dollars more expensive for purchasers using other currencies, possibly reducing demand. Oil prices are also being influenced by the upcoming inflation data from the United States. However, an increase in the number of U.S. oil rigs failed to provide support, although the count of oil rigs decreased by 3 to 496 this week, marking the lowest level since November of last year.
China's crude oil imports in April exceeded levels from the same period last year, but the potential for the European Central Bank to cut interest rates in June has put pressure on oil prices. A drone attack on a Russian refinery by Ukraine has also heightened tensions in the Middle East region.
