Oil rose more than 1% as US interest rates were cut and Middle East tensions escalated (Image: REUTERS/Stringer/Archivo)
O oil, considered a risk thermometer by the market, it operated in a strong rise this Thursday (19). Investors increased their appetite for risk after the Federal Reserve, the Central Bank of the United States, cut interest rates for the first time since March 2020.
The most liquid contracts of the Brent oila reference for the international market, for November, ended the day up 1.67%, at US$ 74.88 per barrel, on the Intercontinental Exchange (ICE), in London.
The contracts of the West Texas Intermediate oil (WTI) for November rose 1.83%, to US$ 71.16 a barrel, on the New York Mercantile Exchange (Nymex), in the United States.
What moved oil today?
The boost for oil was given by the cut in US interest rates the day before.
The Federal Reserve, the US central bank, reduced interest rates by 0.50 percentage points (pp), taking the rate to the range of 4.75% to 5.00% per year.
This was the first reduction since March 2020 and marks the beginning of the monetary easing cycle in the world's largest economy.
Generally speaking, lower interest rates generally stimulate economic growth, which drives demand for oil.
The market also followed the scale of tension in the Middle East conflicts.
On Thursday (19), the leader of Hezbollah stated that the deadly Israeli attacks that blew up radios and pagers of the group went beyond all limits. He gave a speech, broadcast, as sonic booms from Israeli warplanes shook buildings in Beirut.
Lebanon and Hezbollah have blamed Israel for the attacks on Hezbollah communications equipment, which killed 37 people and wounded about 3,000, overwhelming Lebanese hospitals and wreaking bloody havoc on the militant group.
Israel has not commented directly on the attacks, which security sources say were likely carried out by the Mossad spy agency, which has a long history of carrying out sophisticated attacks on foreign soil.
Oil market analysts have warned for months that a war between Israel and Hezbollah, which has so far been exchanging rocket fire, could force Iran, a member of the Organization of the Petroleum Exporting Countries (OPEC), to intervene directly, increasing the risk of disruptions to crude supplies in the Middle East.
*With information from CNBC and Reuters