USOIL 2/MAY/2023It is anticipated that the Federal Reserve, which is responsible for managing the US's monetary policy, will raise interest rates again. This could potentially cause the US economy to slow down and enter a recession later this year.
In recent weeks, concerns about a banking crisis have affected the oil market. The US government took over First Republic Bank, and JPMorgan purchased most of its assets, causing alarm as three other US banks have previously collapsed: Signature Bank, Silvergate Bank, and Silicon Valley Bank. If more banks encounter difficulties, it may lead to a banking crisis that could cause a recession and a decrease in oil demand. Additionally, voluntary production cuts of about 1.16 million barrels per day by OPEC+ countries, including Russia, will take effect in May, impacting oil prices.
On a positive note, the US's manufacturing industry is improving, and with rising demand and employment, this has slightly boosted oil prices.
