Oil rises for third day as interest rate concerns ease  

• Oil rose for a third straight day on Wednesday as investors felt more comfortable with risk a day after remarks from the Federal Reserve chairman eased their worries about future interest rate hikes. Comments from U.S. Federal Reserve Chair Jerome Powell on Tuesday were seen as less hawkish than feared, boosting risk appetite and weighing on the dollar. A weaker U.S. currency makes dollar-denominated oil cheaper for buyers holding other currencies.
• "It would appear traders had become a little more defensive on the expectation of a hawkish shift, but Powell refrained from taking the leap," said Craig Erlam, senior market analyst at brokerage OANDA.
• Investors hope less aggressive U.S. interest rate increases will help the world's biggest economy dodge a sharp economic slowdown or recession that would hit oil demand. Meanwhile, China's ending of COVID-19 curbs is also expected to support demand for fuel. "A looming oil demand surge together with lacklustre global supply growth will ensure that the oil balance tightens over the coming months," said Stephen Brennock of oil broker PVM.
• Brent crude rose 82 cents, or 1%, to $84.51 a barrel by 11:07 a.m. U.S. West Texas Intermediate (WTI) crude climbed 93 cents, or 1.2%, to $78.08. Crude inventories rose by 2.4 million barrels in the week ended Feb 3 to 455.1 million barrels, compared with analysts' expectations in a Reuters poll for a 2.5 million-barrel rise.

(Source: Reuters)