Oil prices hit a nine-month high on Thursday in energy commodities. This came after government data showed a fall in U.S. crude stockpiles last week. Progress towards a U.S. fiscal stimulus deal and strong Asian demand also supported prices.
At 0436 GMT, Brent crude futures rose 45 cents, or 0.9%, to $51.53 a barrel. U.S. West Texas Intermediate crude futures increased by 46 cents, or almost 1%, to $48.28 a barrel. The two benchmarks hit their highest since early March.
Edward Moya, a senior market analyst at OANDA in New York, said all the headlines have been bullish for oil prices.
U.S. stockpiles posted a larger-than-expected draw, he said. Indicating that crude demand remains strong, three of India’s refiners are operating almost at 100% capacity.
Moya also said the U.S. would seem to continue to deliver more monetary and fiscal stimulus. Thus, sending the dollar lower and most commodities higher.
The Energy Information Administration said that the U.S. crude inventories declined by 3.1 million barrels in the week to Dec. 11. This was more than expectations of a 1.9-million-barrel drop.
U.S. lawmakers are closer to agreeing on a $900 billion virus-relief spending package on Wednesday. Top Democrats and Republicans were sounding more confident than they had in months about getting something done. This also boosted the prices of oil.
The last full trading week of the year has been very bullish for crude prices, Moya said. Traders are focusing more on the light at the end of the COVID tunnel, as Asian demand remains strong.
Gold Up Over Fed’s Low Interest Rates
Meanwhile, gold was up on Thursday morning in Asia’s precious metals. The U.S. Federal Reserve pledged to keep interest rates low until an economic recovery is secure. This boosts the yellow metal.
Investors monitor the progress of the latest U.S. stimulus measures as well.
Gold futures rose 0.51% at $1,868.55 by 11:14 PM ET (4:14 AM GMT). The dollar was down on Thursday, also boosting the gold.
The Fed’s policy decision will continue to place interest rates near zero for years to come. It was handed down on Wednesday after the central bank’s two-day policy meeting.
The U.S. central bank also promised to continue its bond-buying program until substantial further progress. That is in restoring full employment and hitting its 2% inflation target.