Oil prices rose on Friday amid prospects of a less aggressive US rate hike, although worries about a recovery in demand capped gains.
Brent crude futures for September delivery rose 94 cents, or 1.0 percent, to $100.04 a barrel by 0630 GMT, while West Texas Intermediate crude rose 63 cents, or 0.7 percent, to $96.41 a barrel.
“Oil is trading very much to the beat of Federal Reserve policy and the implications it could have on both demand destruction and the US dollar,” said Stephen Innes, managing partner at SPI Asset Management.
“With the market falling back to base-case 75 (basis point) hike next week versus 100 (basis point) yesterday, oil prices and the broader market have a little more breathing room today,” Innes said.
The Fed’s most hawkish policymakers said on Thursday they favored another 75-basis-point interest rate increase at the US central bank’s policy meeting this month, not the bigger rate raise that traders had raced to price in after a report on Wednesday showed inflation was accelerating.
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