Fed cuts interest rates – oil falls slightly
18 September 2025 08:19
Oil prices fell slightly on Thursday following the expected decision of the US Federal Reserve to cut the key interest rate, "Komersant Ukrainian" reports citing Reuters.
According to OilPrice.com, as of 06:09 Kyiv time, Brent prices fell by 19 cents, or 0.28%, to $67.76 per barrel. WTI futures fell 22 cents, or 0.34%, to $63.83.
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The Fed’s decision
On Wednesday, the Federal Reserve cut its benchmark rate by a quarter of a percentage point and announced its intention to gradually reduce borrowing costs over the course of the year in response to weak labor market signals. Usually, cheaper loans stimulate demand for oil.
“The signal of further cuts indicates that the Fed considers the risks to the economy from unemployment to be much more serious than the threats from inflation. This will be a bullish factor for Brent, which will partially offset the pressure from OPEC’s strategy to gradually increase production,”
– said Claudio Galimberti, Chief Economist and Director of Global Market Analysis at Rystad Energy.
Demand is growing
Demand was also affected by the data from the US Energy Information Administration: last week, crude oil stocks in the country fell sharply amid a record decline in net imports and a jump in exports to a maximum in almost two years. At the same time, the increase in distillate stocks by 4 million barrels against the forecast of 1 million raised concerns about demand in the world’s largest consumption market, which put additional pressure on quotations.
According to JP Morgan estimates, global oil demand averaged 104.4 million barrels per day as of September 17, which is 0.52 million more than a year ago. Since the beginning of the year, the growth has been 0.8 million barrels per day, which is slightly lower than the forecasted 0.83 million.
“Although air travel volumes are declining in the US and China as the summer travel season comes to a close, activity continues to grow in Europe, the Middle East and Latin America,”
– JP Morgan added.
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