Crude oil prices continued to rise on Thursday, still supported by news in the previous session of a lower than expected rise in U.S. inventories and after Saudi Arabia
Crude Oil Prices Continue to Rise on Saudi Comments – Crude oil prices continued to rise on Thursday, still supported by news in the previous session of a lower than expected rise in U.S. inventories and after Saudi Arabia reaffirmed its commitment to curtail production. Prices were boosted after Saudi Energy Minister Khalid al-Falih said his country will be “sticking” with its policy to withhold production throughout 2018. Saudi Arabia, the de-facto leader of the Organization of the Petroleum Exporting Countries (OPEC), along with some non-OPEC members led by Russia, agreed in December to extend oil output cuts until the end of 2018. The deal to cut oil output by 1.8 million barrels a day (bpd) was adopted last winter by OPEC, Russia and nine other global producers. The agreement was due to end in March 2018, having already been extended once. However, the report also showed that U.S. crude oil production rose to a fresh record of 10.27 million barrels per day (bpd), more than top exporter Saudi Arabia and
not far from the biggest world producer, Russia. Fears that rising U.S. output could dampen OPEC’s efforts to rid the market of excess supplies have weighed on oil prices recently.
Gold Prices Slip, Pull Away From 2-1/2 Week Highs – Gold prices slipped on Thursday, pulling away from the previous session’s two-and-a-half week highs posted after mixed U.S. economic reports dampened expectations for a more aggressive rate hike policy by the Federal Reserve. The precious metal initially dropped as the U.S. dollar moved higher after the Commerce Department reported on Wednesday that consumer prices rose more than expected in January by 0.5%. Year-over-year, consumer prices increased 2.1% higher last month, beating expectations for a gain of 1.9%. Rising inflation would be a catalyst to push the Fed toward raising interest rates at a faster pace than currently expected. However, the greenback’s gains were short lived as a separate report showing that U.S. retail sales fell 0.3% in January, compared to expectations for a 0.2% rise, sparked concerns that the Fed could struggle to raise rates quickly enough to offset inflation pressures.
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