May 04, 2023 (MLN): Oil prices finally got breathing room on Thursday as they recovered slightly after a 3-day sharp decline, amid yesterday’s Federal open market committee (FOMC) meeting.
Brent crude climbed 1.44% to $72.81 per barrel, while West Texas Intermediate crude (WTI) rose 1.27% to $68.9 per barrel.
Notably, WTI recovered 7.63% from a daily low of $63.93 on the day.
The increase comes after both benchmarks fell by more than 4% in the previous session after yesterday’s interest rate hike, by 25 bps, and signaled a possible rate pause.
Fed Chairman Jerome Powell stated that it is a meaningful change to no longer say we anticipate more firming of policy, which opens the door to a potential rate-hike pause.
Additionally, the U.S. dollar index (DXY) fell 0.7% yesterday after the Fed meeting, which has also contributed to today’s rise in oil prices.
Closing in on yesterday’s press conference, Powell remarked that the Fed feels like it's close, or maybe even there in terms of reaching a sufficiently restrictive level.
