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2025-09-18 17:48:07
The "Rate Cut" Paradox in the Crude Oil Market: (1) On Thursday, oil prices edged lower for the second consecutive trading day, with Brent crude futures down 0.4% to $67.65 per barrel and WTI crude futures down 0.5% to $63.75 per barrel. (2) Although the Federal Reserve announced a rate cut on Wednesday and hinted at further reductions in borrowing costs in response to signs of labor market weakness, the market is still weighing the impact of loose monetary policy against concerns about the US economy. (3) Generally speaking, lower borrowing costs boost oil demand and push up prices. Kuwait's oil minister also expects increased oil demand after the rate cut, especially in the Asian market. (4) However, some analysts are skeptical, pointing out that the rate cut itself indicates an economic slowdown, which the Fed is attempting to restore growth. (5) The Federal Reserve Chairman stated that downside risks to employment are increasing relative to inflation, but inflation risks still need to be assessed and managed. (6) Persistent oversupply and weak US fuel demand are also weighing the market. ⑺ Data showed that although U.S. crude oil inventories fell sharply last week, distillate inventories unexpectedly increased by 4 million barrels, far exceeding market expectations of 1 million barrels, which triggered market concerns about the outlook for U.S. demand.
