Crude oil futures traded lower during Thursday's Asian session as the Federal Reserve’s cautious outlook on interest rate cuts in 2025 raised concerns over fuel demand.
By 2:40 pm AEDT (3:40 am GMT) Brent crude futures were down by $0.29 or 0.4% to US$73.10 per barrel, while U.S. West Texas Intermediate (WTI) crude fell by $0.39 cents, or 0.6% to $70.19.
Earlier in the day, Federal Reserve Chair Jerome Powell revealed that policymakers expect to implement only two rate cuts in 2025, fewer than the four forecast in September, due to persistent inflationary pressures.
Lower interest rates generally stimulate economic growth by reducing borrowing costs, which in turn boosts energy demand. The Fed's cautious approach, however, has weighed on market sentiment, raising concerns about a slower pace of economic recovery and its potential impact on oil consumption.
Among data releases, crude stocks fell by 934,000 barrels to 421 million barrels for the week ending 13 December, according to the Energy Information Administration (EIA). Markets had expected a larger draw of 1.7 million barrels.