Oil rose the most since early February and reset key technical levels after the US government’s promise to protect bank depositors calmed markets.
The commodity broke the longest oversold period in the nine-day RSI since November 2021 as Treasury Secretary Janet Yellen said the government could take drastic measures to protect depositors from smaller lenders. Crude oil prices were further boosted as Russia said it will extend its 500,000-barrel-a-day crude production cut until June.
Prices have been stuck in a narrow alley through 2023 before easing as banking turmoil amplified recession fears. Still, leading industry figures predict prices will rise to between $80 and $140 a barrel in the second half of the year.
Wednesday’s Federal Reserve interest rate decision and its expected effect on the economic environment are likely to boost crude oil prices, said Vikas Dwivedi, global oil and gas strategist at Macquarie Group Ltd.
“If these big macro factors start to turn the corner, oil will recover,” Dwivedi said.
Prices:
- WTI for April delivery, which expires on Tuesday, rose $1.69 to settle at $69.33 a barrel.
- The most active May contract advanced $1.85 to $69.67.
- Brent for May settlement gained $1.53 to settle at $75.32 a barrel.
(with the help of Julia Fanzeres)
