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Oil prices rose slightly in early trading on Monday, supported by concerns that conflict in the Middle East could affect supplies from the key producing region and expectations that last week’s U.S. interest rate cut will support demand.
Brent crude futures for November delivery rose 20 cents, or 0.3 percent, to $74.69 a barrel by 0045 GMT. U.S. West Texas Intermediate (WTI) crude futures for November delivery rose 22 cents, or 0.3 percent, to $71.22.
Both crudes had risen in the previous session, supported by lower interest rates in the United States and a decline in American supplies following Hurricane Frances.
On Wednesday, the Federal Reserve cut interest rates by half a percentage point, a bigger drop in borrowing costs than many had expected.
Interest rate cuts typically boost economic activity and energy demand, but analysts and market participants are concerned that the central bank could see a slowdown in the labor market.
“Sentiment has been lifted by the Federal Reserve cutting interest rates amid hopes it can deliver a soft landing for the economy,” ANZ said. “The dollar’s weakness has supported investor sentiment.”
