Oil tests pre-Omicron highs on economic growth hopes  

An oil pump jack pumps oil in a field near Calgary, Alberta, Canada, July 21, 2014. (Reuters)

SULAIMANI (ESTA) — Oil prices extended gains on Wednesday, after the U.S. Federal Reserve chief signaled the central bank may raise rates more slowly than expected.

Brent crude futures rose 8 cents to $83.80 a barrel at 0554 GMT, after jumping 3.5% in the previous session.

U.S. West Texas Intermediate (WTI) crude futures jumped 20 cents to $81.42 per barrel, adding to a 3.8% jump in the previous session.

Both benchmarks are trading at their highest levels since the super contagious Omicron variant of the coronavirus emerged in late November, according to Reuters.

Federal Reserve Chairman Jerome Powell said on Tuesday the economy should withstand the current COVID-19 surge with only “short-lived” impacts and said “it is a long road” to anything close to restrictive monetary policy, Reuters reported.

“A long road to normal means the economy will still see a lot of support over the first half of the year and that is good news for crude prices,” Reuters quoted OANDA analyst Edward Moya as saying.

Data from the American Petroleum Institute (API) industry gave a weaker picture on fuel demand, with a smaller decline in crude stockpiles than expected and bigger builds than expected in gasoline and distillate inventories.

Market sources citing API figures said crude stocks fell by 1.1 million barrels for the week ended Jan. 7, according to Reuters.

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