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Oil Prices Climb amid US Stocks Decline, Mideast Conflict

FILE PHOTO: A motorist fills a car with fuel at a petrol station in Sydney August 18, 2004. REUTERS
FILE PHOTO: A motorist fills a car with fuel at a petrol station in Sydney August 18, 2004. REUTERS
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Oil Prices Climb amid US Stocks Decline, Mideast Conflict

FILE PHOTO: A motorist fills a car with fuel at a petrol station in Sydney August 18, 2004. REUTERS
FILE PHOTO: A motorist fills a car with fuel at a petrol station in Sydney August 18, 2004. REUTERS

Oil prices extended gains on Wednesday after industry data showed a surprise drop in US crude stocks last week, a positive sign for demand, though markets were also keeping a close eye on hostilities in the Middle East.
Brent crude futures rose 26 cents, or 0.29%, to $88.68 a barrel and US West Texas Intermediate crude futures climbed 26 cents, or 0.31%, to $83.62 a barrel at 0634 GMT, Reuters reported.
US crude inventories fell 3.237 million barrels in the week ended April 19, according to market sources citing American Petroleum Institute figures. In contrast, six analysts polled by Reuters had expected a rise of 800,000 barrels.
Traders will be watching for the official US data on oil and product stockpiles due at 10:30 a.m. EDT (1430 GMT) for confirmation of the big drawdown.
US business activity cooled in April to a four-month low, with S&P Global saying on Tuesday that its flash Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to 50.9 this month from 52.1 in March.
"This could help convince policy makers that rate cuts are required to support the economy," ANZ analysts said in a note.
US interest rate cuts could bolster economic growth and, in turn, demand for oil from the world's top consumer of the fuel.
Analysts were still bullish that any latest developments in conflicts in the Middle East will still support markets, though the impact on oil supplies remains limited for now.
"Overall, crude oil prices are well supported around current levels by on-going Middle East risk premium. On the topside, risk of possible renewed OPEC production increase from Jun will help limit any significant upside," said head of markets strategy for United Overseas Bank (UOB) in Singapore Heng Koon How.
"We maintain our forecast for Brent to consolidate at USD 90/bbl by end of this year," Heng added.
Israeli strikes intensified across Gaza on Tuesday, in some of the heaviest shelling in weeks.
"Recent reports suggest that both Iran and Israel consider the current operations concluded against one another, with no follow-up action required for now," ING analysts said in a note.
"The US and Europe are preparing for new sanctions against Iran – although these may not have a material impact on oil supply in the immediate term," they added.

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Billionaire Financier Bessent Confirmed as Trump’s Treasury Chief 

US investor and hedge fund manager Scott Bessent testifies before a Senate Finance Committee hearing on his nomination to be Secretary of the Treasury, on Capitol Hill in Washington, DC, on January 16, 2025. (AFP)
US investor and hedge fund manager Scott Bessent testifies before a Senate Finance Committee hearing on his nomination to be Secretary of the Treasury, on Capitol Hill in Washington, DC, on January 16, 2025. (AFP)
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Billionaire Financier Bessent Confirmed as Trump’s Treasury Chief 

US investor and hedge fund manager Scott Bessent testifies before a Senate Finance Committee hearing on his nomination to be Secretary of the Treasury, on Capitol Hill in Washington, DC, on January 16, 2025. (AFP)
US investor and hedge fund manager Scott Bessent testifies before a Senate Finance Committee hearing on his nomination to be Secretary of the Treasury, on Capitol Hill in Washington, DC, on January 16, 2025. (AFP)

Billionaire hedge fund manager Scott Bessent won Senate approval Monday to become US Treasury secretary, placing him at the forefront of implementing Donald Trump's economic agenda -- which is already triggering global jitters.

Bessent, a Wall Street veteran who was born and raised in South Carolina, has defended the Republican president's tax cutting and tariff proposals while urging efforts to secure supply chains and the dollar's global status.

On Monday, he cleared a confirmation vote with a comfortable margin of 68-29, with bipartisan support.

As Treasury chief, Bessent will have a hand in the administration's tax policies and its budget, confronting the debt limit and steering plans that could lead to fresh tariffs.

Mike Crapo, who chairs the Senate Finance Committee, said Monday that Bessent was "committed to restoring the prosperity and opportunity" seen under Trump's leadership.

But Ron Wyden, the top Democrat on the committee, warned it was unclear that Bessent would serve as a check on Trump's economic plans, which could weigh on consumers and small businesses.

Bessent, 62, has said he would back tougher sanctions on Russian oil majors as a way to end the war in Ukraine, while signaling a hawkish approach on China.

Trump returned to the White House this month vowing lower taxes to aid Americans squeezed by high costs of living, and tariffs to pressure other countries to align on US concerns.

The president has warned of tariffs on allies and adversaries - including major trading partners Mexico and Canada on February 1.

Now all eyes are on how his Treasury chief walks the line between supporting these efforts and avoiding tensions that may roil the world economy.

At his hearing, Bessent disagreed that Trump's proposed duties on imports would be paid for domestically, noting that levies can be used in negotiations, to remedy unfair trade practices or to boost revenues.

He also took aim at government spending and high budget deficits.

He will have to grapple with Trump's promised tax cuts - alongside their consequences for the US economy - as he begins his role.

The Treasury Department has oversight across areas from federal finances to bank supervision. It also oversees US sanctions.

- Family friend -

Bessent has known the Trump family for three decades and was friends with the president's late brother Robert, he previously said.

"I was all-in for President Trump," he said on Trump ally Roger Stone's radio show.

Bessent attended Yale University and served as chief investment officer of Soros Fund Management, the macroeconomic investment firm of liberal billionaire George Soros.

In 2015, he raised capital, including $2 billion from Soros, to start his own hedge fund.

More recently, Bessent said he had not spoken to Soros in years.

Bessent is chief executive at Key Square Group, but has committed to resigning from the position at the hedge fund and divesting his partnership share upon confirmation.

- 'Only-in-America' -

During his confirmation hearing, Bessent recounted taking an internship in finance -- a job that came with an office pullout sofa, allowing him to live in New York rent-free.

"I've been involved in the financial markets ever since," he told lawmakers. "My life has been the only-in-America story that I am determined to preserve for future generations."

Urging for all tools to be used "to realign the economic system to better serve the interests of working Americans," Bessent has criticized "unfair distortions" in global trade.

He previously floated the idea of Trump nominating a "shadow Fed chair" to dilute the influence of Federal Reserve chief Jerome Powell.

But he has since dropped the idea and stated that he supports the central bank's independence in policymaking.

"President Trump is going to make his views known, as many senators did," Bessent said in his hearing on January 16.

He added that on monetary policy, the Fed's rate-setting committee "should be independent."