• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 5 days The United States produced more crude oil than any nation, at any time.
  • 4 days How Far Have We Really Gotten With Alternative Energy
  • 2 days Bad news for e-cars keeps coming
  • 4 days China deletes leaked stats showing plunging birth rate for 2023
  • 5 days The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
Crew Abandons Sinking Bulk Carrier In Red Sea After Houthi Attack

Crew Abandons Sinking Bulk Carrier In Red Sea After Houthi Attack

The drone boat attack on commodity-hauling…

Could Taiwan’s Energy Crisis Derail the AI Boom?

Could Taiwan’s Energy Crisis Derail the AI Boom?

Taiwan's energy crisis poses significant…

Oil Prices Gain 2% As Inflation Data Remains Hot

Oil prices gained over 2% on Wednesday amid the release of U.S. consumer price data for March showing consistent inflation pressure that has analysts predicting the Federal Reserve will raise interest rates in May.

The U.S. Consumer Price Index (CPI) rose a slight 0.1%, compared to its 0.4% increase in February, according to Department of Labor data released Wednesday.

Year-to-date, the CPI is up 5%, compared to 6% year-to-date in February.

The Dow edged up slightly on the CPI data, which suggests slowing inflation, but not enough to inject a great deal of optimism in the economy. The March CPI increase represents the smallest increase since May 2021. 

The ~2% oil price gain comes as analysts had expected a higher increase in the CPI.

At 12:55 p.m. EST on Wednesday, Brent crude was trading up 2% at $87.32, for a $1.71 gain on the day. West Texas Intermediate (WTI) was trading up 2.16% at $83.29, for a $1.76 gain on the day.  

"The CPI number implies, to a certain degree, that the Fed will start cutting rates by the end of the year. That's a positive demand development for energy," Robert Yawger, director of energy futures at Mizuho Securities, told Reuters.

The dollar also dropped sharply on Wednesday in response to the lower-than-expected CPI increase.

Speaking to Reuters on Wednesday, Convera senior market analyst Joe Manimbo said that “Headline inflation coming down more than expected is backing the view of the Fed being basically one more and done”.

Also on Wednesday, Neil Dutta, head of economics at Renaissance Macro Research, was cited by Yahoo Finance as saying that “the odds of stagflation went down while the odds of a soft-landing went up”. 

By Tom Kool for Oilprice.com

More Top Reads From Oilprice.com:

Join the discussion | Back to homepage

Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News