Oil rises to $115 a barrel on Federal reserve cut & Nigeria strike
Oil futures rose to near $115 a barrel on Thursday, 1 May, gaining support from an interest rate cut by the US Federal Reserve and the extension of an oil workers’ strike in Nigeria. If you read, we have updated couple of days back on Oil prices rising to $118 a barrel on 29th April.
The gains in oil prices came as the Fed on Wednesday cut interest rates by a quarter point to 2% and indicated that it expects inflation to moderate. Traders took the Fed’s statement to suggest that more rate cuts are possible.
Rate cuts can boost liquidity in financial markets, brighten the outlook for economic activity and energy demand, and weaken the dollar which tends to bolster commodity prices.
Additional support came from striking oil workers who have shut down Exxon Mobil’s production in Nigeria and pledged to carry on their seven-day strike after failing to reach a deal with the US oil major at talks on Wednesday.
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