Oil prices higher after data, Fed

Oil prices rose Thursday following a mixed US energy report and after the US Federal Reserve signalled it would keep its near-zero benchmark interest rates unchanged for now, analysts said.

US benchmark West Texas Intermediate for July delivery grew 67 cents to $60.59 a barrel compared with Wednesday’s close.

Brent North Sea crude for August won 87 cents to stand at $64.74 a barrel in London midday deals.

Investors are switching focus “between price-supporting news from the US where inventories and rig counts are falling” and concerns about the global supply glut, according to Sanjeev Gupta, head of the Asia-Pacific oil and gas practice at business consultancy firm EY.

The US Department of Energy on Wednesday said the country’s crude reserves fell 2.7 million barrels last week, the seventh straight decline.

Dealers have been hoping that a drawdown of the United States’ burgeoning commercial reserves coupled with a slowdown in its shale output could whittle down excess global supplies.

A surplus of US stocks was one of the reasons oil prices collapsed by more than 50 percent between June and January.

Crude investors are also digesting the Fed’s indication that it will maintain near-zero interest rates for now and adopt a cautious and methodical approach to raising them later in the year.

Interest rate adjustments are closely watched by crude investors as an increase usually leads to a pick-up in the dollar. A stronger greenback makes dollar-priced oil more expensive for buyers using weaker currencies, denting demand.

Elsewhere, Norway’s central bank on Thursday cut its key interest rate to a record low one percent to counteract the impact of lower oil prices on the economy, and warned of a possible further cut.

The Scandinavian country, whose oil sector represents more than 20 percent of gross domestic product, has suffered from an almost 40 percent drop in oil prices since June 2014.

With oil companies reducing their investments, more than 20,000 jobs have disappeared in the sector since January 2014, according to DNB Markets.

Earlier this week oil giant Statoil announced it would eliminate up to 1,500 jobs, or about seven percent of its workforce by the end of 2016.